GE discards materials unit, equity company picks it up
General Electric continued its ever-ongoing restructuring by selling of a manufacturing to unit to equity investment firm Apollo Management. The deal, for around $3.8 billion, involves GE's silicone and quartz materials division.
The division, according to a Wall Street Journal article ("Reshaping GE, Immelt Sells Unit", 9/15/06), "makes silicone used in adhesives and sealants and quartz used in semiconductor manufacturing and in tubing for fiber-optics and lamps."
It is headquartered in the US and has 5,000 employees. As a part of the deal, GE also said it would buy out two related joint ventures, GE Toshiba Silicones and GE Bayer Silicone, and sold them to Apollo.
The deal represents a big move for Apollo, which has around $16 billion invested in various firms. The company has other holdings in the special materials field: special-materials industry, the plastics and adhesives business of Tyco International (acquired in 2006) as well as Berry Plastics Corp. (acquired in 2005). The thought is that they may choose to recombine all or parts of these companies for resale.
GE, whose profits are sagging, may be on track to sell off more units. One considered a likely target is the GE plastics business. It is generally thought that GE's strategy is moving away from commodities to technology and finance. GE's NBC media division has been particularly troubled but I found no rumors of it being up for sale.
GE has made over $65 billion in acquisitions and $30 billion in deacquistions in the last five years under CEO Jeffrey Immelt.
5:23:32 PM 
|
|
