Areva's bid for Alstom's T&D line may be hit

French nuclear power major Areva's efforts to acquire compatriot Alstom's transmission and distribution business in India is likely to be delayed beyond the December 31 deadline, with the two companies engaged in a dispute over how much areva will pay alstom for its transmission and distribution (T&D) business worldwide.

Areva had completed a deal last year to acquire Alstom's T&D business worldwide, except India and some other countries.

It had also made a binding offer to Alstom to take over its T&D business in India, provided the transfer was completed by December 31, 2004.

The original price agreed for the worldwide T&D business was euro 950 million, which was reduced by euro 30 million to reflect the level of cash transferred to Areva.

However, Alstom France has demanded valuation of euro 1.1 billion and the dispute has now been referred to global accounting firm KPMG and both sides have agreed to abide by its decision, industry sources said.

KPMG will give its verdict by the end of this year and so the December 31 deadline for acquiring alstom's operations in India would be delayed, they said.

The offer for india operations included buying the T&D business of Chennai-based Alstom ltd for euro 14.3 million.

The offer was under technical and legal study for which the company had appointed external consultants and lawyers.

The sources said the company had appointed KPMG as its consultant in india. KPMG's india office would now wait for the verdict in paris to give its report and the whole process would not be able to finish by the year-end, they added.