EU blocks French industrial giant's rescue

Share trading in Alstom, France’s prized but indebted maker of high speed trains and luxury cruise liners, was suspended indefinitely today after the EU blocked a multi-billion pound bailout plan.

The Paris stock exchange said the troubled heavy engineering firm requested the suspension and that no date was fixed for trading to resume.

Alstom said the EU refusal to let the French government take a €3.1bn stake in the firm or provide it with long-term loans cast doubt on the viability of a planned rescue package.

The company said its board would meet again at the latest by Monday – the deadline set by the EU for the French government to delay plans to spend billions to rescue Alstom, or face legal action.

EU antitrust chief Mario Monti set the deadline so he can study the subsidies’ competitive impact, as required by EU law.

The rescue plan is designed to prevent the maker of speedy TGV trains, cruise ships and power generators from going bankrupt, endangering tens of thousands of jobs.

The EU is allowing limited aid for Alstom to bridge immediate liquidity problems, but argues a multi-billion pound restructuring can only occur after an in-depth antitrust investigation.