GE Aviation Systems, an operating unit of
General Electric Company
), has recently announced the signing of an agreement with
), an independent designer and manufacturer of control solutions
for the aerospace and energy markets, to divest its hydraulic
thrust reverser actuation systems unit for roughly $200 million
Woodward expects to fund the transaction through available cash
and committed financing options. The company presently has full
availability under its $400 million worth revolving credit
In concurrence with the deal, both the participating companies
also signed a preferred supplier agreement for thrust reverser
actuation systems, which are primarily deployed in commercial
planes. The acquisition is expected to augment the aerospace
segment of Woodward with superior motion control technologies and
operating platforms of General Electric. Moving forward, Woodward
expects to achieve significant operating synergies through mutual
sharing of advanced technologies, thereby increasing its
For fiscal 2013, the to-be divested unit, which manufactures
various products for commercial aircrafts such as the Boeing 737,
Boeing 747, Boeing 777, and Airbus A320, anticipates to rake in
sales of $150 million. Post-acquisition, the Duarte
California-based business would be integrated into the aerospace
business segment of Woodward.
General Electric is one of the largest and the most diversified
technology and financial services corporations in the world. With
products and services ranging from aircraft engines, power
generation, water processing, and security technology to medical
imaging, business and consumer financing, media content and
industrial products, it serves customers in more than 100
countries and employs more than 287,000 people worldwide.
Its segments include Energy Infrastructure, Aviation, Healthcare,
Transportation, Home & Business Solutions and GE Capital.
Evendale-based GE Aviation Systems is a premier supplier of
commercial and military jet engines and components. It also
provides avionics, electric power, and mechanical systems for
aircraft along with an extensive global service network to
support these products.
General Electric currently has a Zacks #3 Rank, which translates
into a short-term Hold rating. We have a long-term Neutral
recommendation on the stock.
GENL ELECTRIC (GE): Free Stock Analysis
WOODWARD INC (WWD): Free Stock Analysis
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