GE Buys Electrical Engineering Company Converteam For Up To $3.7 Billion

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GE Energy this morning announced that it has acquired a stake of approximately 90 percent of Converteam, a France-based provider of electrification and automation equipment and systems, for approximately $3.2 billion.

Converteam’s senior management will retain the remaining stake in the company, but GE has agreed to purchase their shares over the next two to five years for a price that it expects not to exceed $480 million.

Converteam was previously owned by a shareholder group that includes the company’s management, Barclays Private Equity and LBO France. To learn more about the company’s history, check out its Wikipedia profile.

The transaction is expected to close during third quarter 2011, subject to customary closing conditions.

Converteam’s solutions enable its clients to replace or improve mechanical processes with high-efficiency electric alternatives that deliver better reliability, less maintenance and lower emissions. The company’s portfolio includes drives and other power electronics, advanced rotating machines, generators and controls.

Converteam operates across six key vertical sectors: offshore and onshore oil and gas, power generation, wind and solar renewables, industrial, marine and services.

Headquartered in Massy, France, Converteam has 5,300 employees, including more than 1,600 engineers, and operates in more than 80 countries.

Converteam recently announced 2010 sales of approximately $1.5 billion and EBITDA of approximately $239 million, with approximately 36 percent growth in orders versus 2009.

With the addition of the company, GE Energy’s goal is to bring new integrated product offerings to existing customers and apply its technology to new applications in a broad range of industrial verticals. The business expects to realize approximately $250 million in annual operating synergies by year five.

In the last six months, GE Energy has announced the acquisition of Dresser, Wellstream Holdings, Lineage Power Holdings and Well Support.