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General Electric to Buy Wellstream PLC for $1.3 Billion (GE)
Multinational conglomerate General Electric Company ( GE ) on Monday announced it will buy U.K.-based oil & gas producer Wellstream PLC.
In pursuant to the deal, GE will pay Wellstream shareholders 780 pence per share in cash, as well as a special dividend of 6 pence in cash per Wellstream share. That total of 788 pence per share represents a 29% premium over Wellstream's Friday closing price.
Wellstream's board of directors will reportedly unanimously approve the deal, which is expected to close in the first quarter of 2011.
Claudi Santiago, President and CEO, GE Oil & Gas commented "Wellstream is an excellent strategic fit with GE's Oil & Gas business and represents an important win for customers, GE, and for Wellstream's shareholders and employees. Wellstream's flexible riser and flowline products will extend our subsea solutions portfolio, providing customers - including those in Brazil, Africa and Asia - with the reliable technology and services needed to tackle their toughest deepwater challenges and to optimize the efficient production of oil and gas."
GE shares rose 12 cents, or +0.7%, in premarket trading Monday.
The Bottom Line
We have been recommending shares of General Electric ( GE ) since July 23, 2010, when the stock was trading at $15.21. The company has a 3.16% dividend yield, based on Friday's closing stock price of $15.21.
General Electric Company ( GE ) is a "Recommended" dividend stock, holding a Dividend.com DARS™ Rating of 3.5 out of 5 stars.