French government agrees to buy 20% stake in power-to-rail company Alstom, amid GE bid

The final obstacle to GE's $17 billion takeover of Alstom's power division has been overcome after the French government agreed to terms with the French engineering company's main shareholder.

Economy minister Arnaud Montebourg said Sunday on French television that the government will buy a 20-percent stake in Alstom from construction giant Bouygues SA.

The move fulfills his pledge to ensure that the French government would retain a say in jobs and decision-making at the company, which builds power plants and France's famed high-speed TGV trains. He did not comment on the final price of the stake to be bought from Bouygues.

Alstom's board approved GE's offer Saturday, a day after the government withdrew its long-held opposition and threw its support behind the American takeover, with a few conditions.