GE Industrial, Cisco Likely to Unveil Alliance, Analysts Say
New York, June 5 (Bloomberg) -- General Electric Co.'s Industrial Systems unit and Cisco Systems Inc. are likely to unveil an alliance to sell GE's electrical control software and factory-automation services with Cisco's networking equipment as a package, analysts said.
GE Industrial Systems provides everything from controls, relays and switches used to regulate electricity in factories to automation software used in plants. Cisco is the world's biggest maker of computer-networking equipment.
Through a joint venture or alliance, the companies would be able to sell a package to manufacturers to upgrade old plants or build new ones with Web-based controls and remote monitoring systems, analysts said. GE Industrial Systems already has several customer-based Internet sites used to cut costs in ordering and regulating products and makes factory-automation software.
``A joint venture or alliance with Cisco could let (General Electric) sell specifications for power equipment and software wired'' with Cisco's hardware as a package, said Prudential Securities analyst Nicholas Heymann, who has a ``strong buy'' rating on General Electric.
General Electric and Cisco declined to comment. The two companies issued a statement saying executives planned to make an announcement tomorrow at 11 a.m. in New York.
An alliance would help companies save money because monitoring plants electronically and via the Web would allow them to catch problems sooner in automated plants and cut down on paperwork.
Plainville, Connecticut-based GE Industrial Systems also makes controllers, capacitors, surge-protection equipment and AC and DC current motors. General Electric is based in Fairfield, Connecticut. The company's shares fell 1 1/4 to 51 7/16 on the New York Stock Exchange today.
San Jose, California-based Cisco fell 1 1/8 to 63 1/4. |
