GE completes sale of plastics unit |
|
|
|
Published
:
Fri, 31 Aug 2007 19:07
|
HARTFORD, Conn. (AP) - General Electric Co. completed its $11.6 billion sale of its plastics division on Friday, and plans to use the proceeds to help pay for a stock buyback program.The sale to petrochemicals manufacturer Saudi Basic Industries Corp. is part of the Fairfield-based conglomerate's strategy of selling slower growth and volatile businesses such as insurance and invest in high-growth, high-technology businesses, such as health care and water processing technology.The deal is expected to create a net gain, after taxes, of $1.5 billion.GE will use the proceeds to complete its current $27 billion stock buyback program, with $12 billion of the $14 billion planned for 2007 in the second half of this year.The plastics division is a $6.6 billion global supplier of plastic resins used in automotive, health care, consumer electronics, transportation, building and construction, telecommunications, and optical media.Its results have been weighed down by the rising costs of natural gas and raw materials since 2004. Profits for the division fell by 22 percent to $674 million in 2006.Based in Pittsfield, Mass., it employs 10,300 people in 60 locations worldwide.SABIC intends to expand the business globally and is not planning to cut jobs, company officials said.GE's plastics division dates to 1930, resulting directly from Thomas Edison's experiments with plastic filaments for light bulbs in the 1890s. It grew into a significant GE venture where Jeff Immelt, president and chief executive, began his GE career.GE shares rose 27 cents to $38.67 in afternoon Friday.On the Web:http://www.ge.comCopyright 2007 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
|
|
|
|
Print this Story
Sabic buy of GE Plastics cleared by EU 