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General Electric To Sell Its Appliances Business To Qindgao Haier For $5.4 Billion

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General Electric Company (NYSE: GE) announced on Friday that it has reached an agreement with Qingdao Haier to sell its appliances business for $5.4 billion.

General Electric noted that the transaction values the appliances business at 10 times the last 12 months of EBITDA and the transaction will result in an after-tax gain of approximately $0.20 per share at closing.

General Electric also added that it has entered into a long-term agreement with Haier to continue use of the GE Appliances brand and that the segment's headquarters will remain in Louisville, Kentucky.

The transaction is expected to close in mid-2016 and has already been approved by the Board of Directors of both companies.

"We are proud of Appliances' history and performance," said GE Chairman and CEO Jeff Immelt. "Haier has a good track record of acquisitions and of managing brands. Haier has a stated focus to grow in the U.S., build their manufacturing presence here, and to invest further in the business. Innovation, new product introduction and brand management are fundamental to their overall strategy. GE Appliances provides Haier with great products, state-of-the-art manufacturing facilities and a talented team. In addition, we see the opportunity to work together to build the GE brand in China."

Shares of General Electric were trading lower by 1.34 percent at $28.67 Friday morning.

Posted-In: GE GE Appliances General Electric Haier Jeff Immelt Qingdao HaierNews Asset Sales

 

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