The likelihood of a deal taking place is higher at this time since GE has lowered its expected selling price to around $2 billion, from its earlier $3 billion plus.
As per sources familiar with the matter at hand, GE has resumed negotiations to divest its industrial solutions business to Swiss engineering company ABB Ltd. The move comes after the U.S. industrial conglomerate moderating its price expectations, said sources.
The development underscores John Flannery’s determination to see through the strategic shift in GE’s portfolio of divesting all non-core assets.
According to sources familiar with the matter at hand, GE is entertaining the possibility of selling its industrial solutions business for as little as $2 billion. Initially it was hoping to sell it for more than $3 billion, said four sources.
Last month, the talks between GE and ABB came to an abrupt end over the price of the sale.
Sources have cautioned that although there is no certainty that this time the talks between the two will lead to a sale or that no other bidder will emerge, however, French electrical component and energy management group, Schneider Electric SA is reportedly still in pursuit and hasn’t lost interest in the company, revealed sources.
Sources have preferred the cover of anonymity since the deliberations are on-going and thus confidential.
While Schneider Electric did not immediately respond to a request for comment, GE and ABB declined to comment.
Earlier, GE had eliminated Schneider Electric as a prospective buyer since it would face significant antitrust scrutiny, said sources.
Of late, Ulrich Spiesshofer, ABB’s Chief Executive has come under increased pressure over profitability after a price rise in raw material along with overcapacity gave it a dented its latest quarterly earnings.
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