Saudi firm buys Pittsfield-based GE Plastics
General Electric Co. said today that it will sell its Pittsfield, Mass.-based GE Plastics division to petrochemicals manufacturer Saudi Basic Industries Corp. for net proceeds of about $9 billion.
GE Chairman and Chief Executive Jeff Immelt called the long-expected divestiture of the 10,300-employee plastics unit "another important step" in the company's strategy to dispose of some businesses and invest in high-growth, high-technology businesses.
The deal is expected to close in the third quarter. Afterward, Brian Gladden, who currently serves as vice president of GE Plastics' resin business, will become president and chief executive of the new business, which Saudi Basic Industries will rename.
Charlene Begley, the current president in chief executive of GE Plastics, will move to a corporate role focused on closing the deal and will report to Immelt.
GE Plastics supplies plastic resins used in industries such as automotive, healthcare and consumer electronics. GE values the business at about $6.65 billion.
GE said it would use the proceeds primarily to increase its planned 2007 stock buyback program. It now expects to buy back $7 billion to $8 billion in stock, up from the previous plan of $6 billion. The deal is expected to create a net gain, after taxes, of $1.5 billion for the conglomerate. (AP)
