GE to Acquire Power Business for $250 Million
May 10 2016 - 09:20AM
Dow Jones News
General Electric Co. said Tuesday it has agreed to buy a heat
recovery steam generator business for $250 million, expanding the
company's power assets as it shifts its focus back to
industrials.
The company's power generation division, GE Power, will acquire
the heat recovery steam generator unit of Doosan Engineering &
Construction in an all-cash deal.
GE said the deal would expand its combined-cycle power plant
portfolio and increase offerings for customers amid higher
demand.
Heat recovery steam generator technology, a key component of a
combined-cycle power plant, converts water into steam by capturing
the exhaust heat from a gas turbine. The steam is then used to
drive a steam turbine to produce more power.
GE is in the process of shedding its banking business and has
been shifting back to an industrial base. In November 2015, GE said
it completed its long-running acquisition of Alstom SA's power
business. Alstom Power and GE Power & Water combined to form GE
Power.
In April, GE posted a quarterly decline in operating income and
orders for its core industrial businesses, as a global oil-market
rout continued to weigh on the company's performance. Profit in the
power business, excluding Alstom, fell 28% in the first quarter,
but the company expects revenue and earnings to rise in the second
half of the year.
Shares of GE, which have fallen 2.9% so far this month but are
still up 9.2% from a year ago, were inactive premarket.
Write to Joshua Jamerson at joshua.jamerson@wsj.com
(END) Dow Jones Newswires
May 10, 2016 09:05 ET (13:05 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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