By Austen Hufford
General Electric Co. said Wednesday it has agreed to sell its water and process technologies business to France's Suez SA and one of Canada's largest pension funds.
Suez and Caisse de dépôt et placement du Québec are buying GE Water in a deal that values the unit at about $3.4 billion, the two companies said.
The pension fund will invest $700 million for a 30% stake while Suez will have a 70% stake and will contribute its own industrial-water business to create a new, self-standing business unit within Suez, encompassing all of its industrial-water activities.
With operations in 130 countries and over 7,500 employees, GE Water supplies equipment, chemicals and services for the treatment of water and wastewater. The unit had revenue of about $2 billion in 2016.
Suez and the pension fund said the long-term demand for the business was strong due to long-term concerns over growing water scarcity, the effect of climate change on the water cycle and the increased concerns related to industrial wastewater and its impact on the environment.
In October, GE announced plans to sell the business. The deal is expected to close by midyear.
For GE, the deal continues a trend of the past three years, as the company has pared back businesses, betting it can grow faster by focusing more narrowly on heavy industrial equipment and by building a service business rooted in software and the digital world. GE has sold off the bulk of its GE Capital financial-services arm, in deals valued at about $195 billion.
Write to Austen Hufford at [email protected]