On-Site Power, Reciprocating Engines

GE Selling Distributed Power unit to Advent International for $3.25B

Financially struggling energy giant GE is selling its distributed power business to an equity firm for nearly $3.3 billion, the Boston-based company announced Monday.

Advent International is acquiring the GE unit which provides industrial gas engines, power equipment and services focused on power generation at the point of use, according to the release. The distributed power portfolio includes engines which generate 200 kW to 10 MW of power.

The deal includes the Jenbacher and Waukesha engine brands as well as manufacturing sites in Austria, Canada and the U.S. GE’s Distributed Power unit totaled more than $1.3 billion in sales last year.

“Distributed Power is a terrific asset with highly regarded engines that are the go-to OEM for the efficient generation of electrical power and heat as well as gas compression,” said Ranjan Sen, Managing Partner at Advent International, in a statement. “The business has significant growth potential on a global scale and talented employees all over the world. We plan to invest substantially in critical areas such as the product portfolio, service network and digitization to support Distributed Power in sustainably strengthening its market position.” 

Advent International has made more than 100 transactions in the industrial, energy and business service sectors. The transaction is expected to close by the fourth quarter, pending regulatory approvals.

GE, one of the nation’s biggest industrial firms for more than a century, has been shedding businesses in recent years to shore up its bottom line amidst a financial crisis and the decline in power generation markets. The company sold its GE Capital unit in 2011 and the appliance unit five years later.

Meanwhile, several big-time acquisitions haven’t turned out as well as expected. The deal to buy France’s Alstom’s power business for about $13 billion in 2014  has garnered mixed results.

Alstom announced earlier this year it would pull out of three energy joint ventures with GE, which will cost the latter about $3.1 billion, according the reports. GE merged its Power & Water unit with Alstom to form GE Power.

GE also was eliminated from the Dow Jones Industrials 30 this week for the first time in more than a century. Its stock price has dropped more than 67 percent in the past decade, falling below $13 per share in recent trading.

Also based in Boston, Advent International has invested more than $40 billion across 41 nations since its 1984 founding.