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Strategies & Market Trends : Speculating in Takeover Targets -- Ignore unavailable to you. Want to Upgrade?

To: richardred who wrote (2715)	3/29/2011 12:16:46 PM
From: richardred	Read Replies (1) \| Respond to of 7243

G.E. to Buy Converteam for $3.2 Billion By DEALBOOK General Electric announced on Tuesday that its energy division would acquire a 90 percent stake in the power conversion specialist Converteam for $3.2 billion, raising G.E.’s position in energy-efficient-equipment manufacturing. GE Energy, which is buying the position from a group of investors that includes Converteam management, Barclays Private Equity and LBO France, plans to acquire rest of the company over the next two to five years. The price for the remaining stake, which is held by Converteam’s senior management, will depend in part on how the business performs. GE expects to pay no more than $480 million. “High-efficiency, fully electric solutions represent a megatrend across the global energy landscape,” John Krenicki Jr., chief executive of GE Energy, said in a statement. “Our customers in key industries increasingly demand more reliable, efficient and flexible solutions in order to improve their competitiveness. Converteam’s world-class people and energy efficient products and services connect a lot of pieces in our portfolio, which will enable us to offer integrated solutions to our customers.” The acquisition will add to G.E.’s strength in energy-efficient-equipment manufacturing. According to the company, the industry, which is roughly $30 billion in size, is growing faster than the global economy. In 2010, Converteam reported profit of $239 million on revenue of $1.5 billion. The company will help bolster G.E.’s presence in a number of areas, including oil and natural gas, renewable energy and mining. It also gives G.E. more opportunity in emerging markets like China, Brazil and the Middle East. “G.E. and Converteam complement each other superbly,” Pierre Bastid, head of Converteam, said in a statement. “As a long-standing partner, G.E. fully understands our business model and will add significant value by allowing our technologists to work within G.E.’s tremendous network of researchers and engineers. In addition, we will expand our global footprint, extend our customer reach and be able to tap into a world-class supply chain.” The deal, which has been backed by Converteam management and employee groups, is expected to close in the third quarter. dealbook.nytimes.com