By Ellen Cools
The $2.6 billion transaction was announced on September 25, 2017, and is expected to be accretive to operational EPS in the first year.
ABB says the transaction provides growth opportunities by coupling ABB’s digital offering, ABB Ability, with the GEIS installed base. ABB expects to realize approximately $200 million of annual cost synergies in year five.
“We are very pleased to welcome GE Industrial Solutions to ABB,” said ABB CEO Ulrich Spiesshofer. “The combination reinforces ABB’s position as a worldwide leader in electrification and accelerates our growth and competitiveness in key markets, particularly North America.”
GEIS will be integrated into ABB’s Electrification Products (EP) division, led by EP president Tarak Mehta, as a new business unit called Electrification Products Industrial Solutions (EPIS). Stephanie Mains, previously president and CEO of GEIS, will lead the new business unit as managing director.
As part of the transaction, ABB has established a long-term strategic supply relationship with GE to supply them with products and solutions from across the ABB portfolio. Included in the acquisition is the right to use the GE brand.