GE sells security unit for $1.8 billion
HARTFORD, CONNECTICUT - General Electric said that it will sell its fire alarm and security systems unit to United Technologies (UTC) for $1.82 billion, continuing a sale of what the industrial conglomerate considers non-core businesses.
GE has sold off pieces of its businesses this year, including an 81 percent stake of its homeland protection business to Safran of France earlier this year for $580 million. It is currently in negotiations with Comcast over a plan to eventually sell off its stake in NBC Universal.
The company had begun soliciting buyers for the security unit, which is part of the conglomerateÂ’s enterprise solutions division, this summer, people briefed on the matter told DealBook.
“The security business required significant investment in its capabilities to evolve and better serve the security industry,” Charlene Begley, the president of GE Enterprise Solutions, said in a statement. “For our customers and our employees, UTC is a natural fit.”
United Technologies, based in Hartford, Conn. and itself a conglomerate that produces Sikorsky helicopters, Otis elevators and Carrier air conditioners, has made no secret of its hunger for deals. As of last month, the company had spent only about $560 million of the $2 billion it has earmarked for this year, Gregory J. Hayes, United Technologies’ chief financial officer, said on a conference call with analysts last month. He added that the deal pipeline was “very full.”
“I feel better about the M&A market than I have in a long time,” Mr. Hayes said.
Among the businesses United Technologies has sought to bolster is its own fire and security business, which the company has put together from the likes of Chubb security. Earlier this year, the company acquired Detection Logic Fire Protection for an undisclosed amount.
“In just a few years, if you think about UTC Fire and Security, it has become the number two player in the large fire and security industry with tremendous growth opportunity,” Louis R. Chenevert, United Technologies’ chief executive, said at a conference.
The GE unit will become part of UTC Fire & Security, which is based in Connecticut and led by William Brown.
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