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General Electric sells appliances business for US$5.4bn

Last updated: 08:30 15 Jan 2016 EST, First published: 03:30 15 Jan 2016 EST

Fridge
It is time for GE to close the door on its appliances business after more than 100 years

Industrial holding company General Electric (NYSE:GE) is to sell its appliances business to Qingdao Haier for US$5.4bn.

GE said the transaction values GE Appliances at 10 times the last 12 months of earnings before interest, taxes, depreciation, and amortization (EBITDA).

The sale will generate an after-tax gain of around 20 cents a share, it added.

GE expects to offset the gain with restructuring in 2016.

As part of the transaction, GE has entered into a long-term agreement with Haier to continue use of the GE Appliances brand, while Louisville will remain the headquarters for GE Appliances.

“We are pleased to be selling our appliances business to Haier, which is committed to growing the business globally,” said GE chairman and chief executive officer Jeff Immelt.

“GE Appliances is performing well and there was significant interest from potential buyers, helping drive a good deal which will benefit our investors, customers and employees,” he added.

Last year a US$3.3bn deal to sell the business to Swedish rival fell through on competition concerns.

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