US Edition Alstom, the troubled French conglomerate, will announce "imminently" that it is to sell its industrial turbines operation to Siemens, the German engineering group, for about £700m.
An Alstom spokesman confirmed that a deal for the turbines unit would be announced soon, safeguarding more than 2,000 UK jobs. He declined to comment on the link with Siemens, saying Alstom would not discuss market speculation and that several companies have been mooted as possible bidders.
The German media has reported that Hitachi was also bidding for the unit. Siemens declined to comment but a source familiar with the deal said the German company was, indeed, the buyer.
Analysts have noted that the turbines business would fill a gap in Siemens's power engineering portfolio and that the company is one of a few companies in the sector with a strong enough balance sheet to make acquisitions. Siemens has also been touted as a possible buyer for Alstom's larger transmission and distribution business, but sources said it was not interested.
Alstom, which employs 112,000 people and builds the TGV high-speed train, put its industrial turbines division up for sale last month as part of a programme of disposals intended to trim debt. The division is based in Lincoln, where it employs 2,300 workers.
Alstom recently announced a Eu600m (£414m) emergency rights issue and its share price has crashed 65pc over the past year amid fears of a liquidity crisis. The company's closing price on Friday of Eu1.58 gave it a market capitalisation of £306m, compared with net debts of £1.4 billion.
Patrick Kron, chief executive, plans to battle back by disposing of £2 billion of assets. Meanwhile, he has secured a credit line of Eu1 billion to tide the company over in the short term.
Last week, the company advised shareholders to act with "extreme prudence" over a second takeover approach from a Jean Mathew of MJ Global Acquisitions. Mr Mathew only gave a Hotmail internet address to reply to.
His first missive, on April 1, drove the stock 10pc higher despite being dismissed as an April fool. Alstom said it believed the letters may have been an attempt to manipulate the group's share price.