For months, General Electric Co. has been absent from the big deal rumor mill. Now, as the company emerges from hibernation with about $50 billion of cash on hand, there are plenty of ideas and rumors for businesses it could sell or buy.
Sell:
On Friday, Moog Inc., a manufacturer of precision control equipment for aircraft put out a press release saying it’s in discussions with GE Aviation Systems to purchase its flight control actuation product line in Wolverhampton, U.K. that saw $100 million in revenues in 2008. GE had picked up that business when it bought Smiths Aerospace in May, 2007.
“Moog and GE have initiated the applicable regulatory filings and expect to sign a definitive purchase agreement very shortly,” Moog’s press release said. A GE spokeswoman confirmed the companies have signed a letter of intent on the deal. “GE Aviation Systems has determined that Wolverhampton would fit better with an organization where high lift and flight controls are considered core competencies and strategic to its future,” said Jennifer Villarreal, a spokeswoman at GE Aviation in Grand Rapids, Mich. The deal would add to Moog’s Aircraft segment, which projects sales of $652 million in fiscal 2009.
In 2008, the company scrapped its stated intentions to sell its private label credit card division, rail-leasing business and appliance division as the weak economy and stock market brought down deal prices. As it aims to overhaul its wounded GE Capital division, the company could also recalibrating it’s industrial portfolio.
GE’s security division could also be on the block. Wire services reported in late August that GE hired JP Morgan Chase to shop its troubled security division, which could fetch up to $2 billion. A spokeswoman at GE Security declined to comment but did not dismiss the news as false.
“GE is going through an identity crisis,” said Carla Zilka, founder of NexGen Advisors LLC and a former GE Executive, citing GE Security as one the company formerly identified as a growth business. “Jeff [Immelt] needs to figure out what GE’s core businesses are going to be, set a plan and execute it.”
Buy:
New rumors suggest that GE may be interested in buying power transmission and distribution businesses from France’s Areva. In May, the French Prime Minister suggested that the state-owned power company should divest those businesss and focus on nuclear power.
“We like the idea of GE increasing its stake in the global power market,” wrote Bernstein Research analyst Steven Winoker, in a note on Tuesday. He notes that power-related businesses are core to GE and the company has a limited exposure to transmission and distribution at the moment.
He thinks GE, which reported $52 billion in cash at the end of the second quarter, could afford the roughly $6 billion Areva assets. But “political and other factors will likely make an acquisition by GE unlikely,” he said, noting that the French state owns 90% or more of Areva and would likely want to sell to French power giant Alstom. Bloomberg, however, reported that GE may be preparing a bid with private equity partners Apollo Management and CVC Capital Partners. GE declined comment.
Sell:
On Friday, Moog Inc., a manufacturer of precision control equipment for aircraft put out a press release saying it’s in discussions with GE Aviation Systems to purchase its flight control actuation product line in Wolverhampton, U.K. that saw $100 million in revenues in 2008. GE had picked up that business when it bought Smiths Aerospace in May, 2007.
“Moog and GE have initiated the applicable regulatory filings and expect to sign a definitive purchase agreement very shortly,” Moog’s press release said. A GE spokeswoman confirmed the companies have signed a letter of intent on the deal. “GE Aviation Systems has determined that Wolverhampton would fit better with an organization where high lift and flight controls are considered core competencies and strategic to its future,” said Jennifer Villarreal, a spokeswoman at GE Aviation in Grand Rapids, Mich. The deal would add to Moog’s Aircraft segment, which projects sales of $652 million in fiscal 2009.
In 2008, the company scrapped its stated intentions to sell its private label credit card division, rail-leasing business and appliance division as the weak economy and stock market brought down deal prices. As it aims to overhaul its wounded GE Capital division, the company could also recalibrating it’s industrial portfolio.
GE’s security division could also be on the block. Wire services reported in late August that GE hired JP Morgan Chase to shop its troubled security division, which could fetch up to $2 billion. A spokeswoman at GE Security declined to comment but did not dismiss the news as false.
“GE is going through an identity crisis,” said Carla Zilka, founder of NexGen Advisors LLC and a former GE Executive, citing GE Security as one the company formerly identified as a growth business. “Jeff [Immelt] needs to figure out what GE’s core businesses are going to be, set a plan and execute it.”
Buy:
New rumors suggest that GE may be interested in buying power transmission and distribution businesses from France’s Areva. In May, the French Prime Minister suggested that the state-owned power company should divest those businesss and focus on nuclear power.
“We like the idea of GE increasing its stake in the global power market,” wrote Bernstein Research analyst Steven Winoker, in a note on Tuesday. He notes that power-related businesses are core to GE and the company has a limited exposure to transmission and distribution at the moment.
He thinks GE, which reported $52 billion in cash at the end of the second quarter, could afford the roughly $6 billion Areva assets. But “political and other factors will likely make an acquisition by GE unlikely,” he said, noting that the French state owns 90% or more of Areva and would likely want to sell to French power giant Alstom. Bloomberg, however, reported that GE may be preparing a bid with private equity partners Apollo Management and CVC Capital Partners. GE declined comment.
No hay comentarios:
Publicar un comentario