Economy

Credit Suisse takes ABB to the United States with GE deal

Credit Suisse takes ABB to the United States with GE deal”

Power grids maker ABB is buying General Electric's Industrial Solutions business for $2.6 billion on a bet that it can improve lacklustre margins at the unit over the next five years, the Swiss engineering company said on Monday.

GE Industrial Solutions had revenue of $2.7 billion previous year and employs about 13,500 people worldwide. GE shares closed Friday at $24.87 and are indicated 0.1% higher in premarket trading.

ABB spoke up the potential for GE Industrial Solutions to expand its access to North America through an "established installed base", "strong roots" and "deep customer relationships".

"With this next step of active portfolio management, we continue to shift ABB's center of gravity, in line with our Next Level strategy, by strengthening competitiveness, mainly in the North American market, and lowering risk with an early-cycle business".

Atlanta, Georgia-based GE Industrial Solutions makes circuit breaks, switchboard panels and other electrical grid hardware used by industry and residential clients. The company employs about 13,500 people around the world.

The transaction is expected to be operationally accretive in year one and to help ABB realise some United States dollars 200 million in annual cost synergies in year five, it said. The business recorded an operational earnings, before interest, tax, depreciation and amortisation (EBITDA) margin of 8% and an operational EBITA margin of about 6% in 2016, when its revenues reached Dollars 2.7 billion.

The purchase adds to the more than 470 acquisitions already agreed by European buyers for USA businesses so far this year - the busiest year-to-date for such deals since 2008, according to analysis of data from Dealogic.



Like this

Latest


25 September 2017
Emcor Group Inc Sentiment Improves on Better Stock Potential
It is positive, as 46 investors sold AMP shares while 229 reduced holdings. 138 funds opened positions while 500 raised stakes. The stock of GATX Corporation (NYSE:GATX) is a huge mover today! Barclays Capital has "Equal-Weight" rating and $123 target.

25 September 2017
Aldi unveils plans for 70 new United Kingdom stores
With the traditional supermarkets chopping down prices, Aldi has been forced to do the same in order to maintain its value proposition.

25 September 2017
Iran successfully tests new ballistic missile: state media
Tehran insists its missile program doesn't the resolution, saying the missiles are not created to carry nuclear weapons. Mr Trump said this week he has reached a decision on the nuclear deal, but hasn't revealed what it is.

25 September 2017
Shares in Activision Blizzard, Inc (ATVI) Acquired by Atlantic Trust Group LLC
Following the sale, the chief executive officer now directly owns 48,472 shares of the company's stock, valued at $2,972,303.04. Caledonia Private Investments Pty Ltd decreased Activision Blizzard Inc ( ATVI ) stake by 72.81% reported in 2017Q2 SEC filing.

25 September 2017
Von Miller blames himself for Denver loss after freakish unsportsmanlike penalty
ORCHARD PARK - When the Buffalo Bills lined up against the Denver Broncos, two players stood out: Aqib Talib and Chris Harris Jr. Unsportsmanlike conduct penalties on Buffalo defenders Micah Hyde and Jerry Hughes aided Denver on its 79-yard drive.

25 September 2017
I will always have 'special affection' for Chelsea - Diego Costa
Morata is very good in the box and scores a lot of goals with his head. "We wish him all the best for the future", Conte said.

25 September 2017
Indian-origin bodybuilder dies after Thai kick-boxing match in Singapore
Lim, who was shocked at the turn of events, said: "I thought it was just a normal (technical) knockout". Police said they were investigating the death.

25 September 2017
Influx has come to a halt: Bangladesh
The prime minister of Bangladesh Sheikh Hasina at the podium of the UN, September 21, 2017 in NY . Misbah Uddin Ahmed, head of the main health complex there, citing reports from female clinicians.

25 September 2017
Confirmed! Hrithik Roshan Will Be In Super 30
He says, "I can totally trust Vikas Bahl with my life's story as I feel he can put out my story in the best way possible". He provided them with study materials and lodging for a year, while his mother, Jayanti Devi, cooked meals for them.

25 September 2017
Mohanlal's Dance Version Of Jimikki Kammal Has Taken The Internet By Storm
Sheril danced to Jimikki Kammal song along with the members of her college and uploaded it on YouTube as part of Onam celebration. Since then, a lot of fan videos have surfaced on social media, giving the track some exciting styles of choreography.



Recommended