You are here: Home » International » News » Companies
Business Standard

ABB bolsters US business with $2.6 bn GE Industrial Solutions deal

GE will benefit through an expanded strategic supply relationship with ABB: GE CEO

Press Trust of India  |  New Delhi 

ABB
ABB and GE have agreed to establish a long-term, strategic supply relationship for GE and ABB products

Swiss engineering group today announced the acquisition of Industrial Solutions, GEs solutions business for $2.6 billion.

Industrial Solutions has deep customer relationships in more than 100 countries and an established installed base with strong roots in North America, ABBs biggest market, said in a statement.


The Industrial Solutions is headquartered in Atlanta, Georgia, and has about 13,500 employees around the world. In 2016, it had of about $2.7 billion, with an operational margin of about 8 per cent and an operational EBITA margin of about 6 per cent.

The company's said: "will acquire Industrial Solutions for $2.6 billion; the transaction will be operationally accretive in year one. expects to realise approximately $200 million of annual cost synergies in year five, which will be key in bringing Industrial Solutions to peer performance."

As part of the transaction and overall value creation, and have agreed to establish a long-term, strategic supply relationship for Industrial Solutions products and products that sources today, it added.

CEO Ulrich Spiesshofer said: "With Industrial Solutions, we strengthen our Number 2 position in electrification globally and expand our access to the attractive North American market."

CEO said: "This combination brings together two global businesses with a broad complement of electrical protection and distribution assets."

will benefit through an expanded strategic supply relationship with ABB, he said.

Included in the acquisition is a long-term right to use the brand. will retain the Industrial Solutions management team.

After closing, this transaction will have an initial dampening effect to EPs operational EBITA margin. commits to returning EP to its target margin corridor of 15-19 per cent during 2020.

ABBs EP division delivers more than 1.5 million products to customers around the world every day through a global network of channel partners and end-customers.

The comapny said Given this transaction, has decided to put the previously announced share program on hold.

The transaction is expected to close in first half (H1) of 2018, subject to customary regulatory clearances.

First Published: Mon, September 25 2017. 15:47 IST
RECOMMENDED FOR YOU