May 10, 2016 8:47 a.m. ET
General Electric Co.
said Tuesday it has agreed to buy a heat recovery steam generator business for $250 million, expanding the company’s power assets as it shifts its focus back to industrials.
The company’s power generation division, GE Power, will acquire the heat recovery steam generator unit of Doosan Engineering & Construction in an all-cash deal.
GE said the deal would expand its combined-cycle power plant portfolio and increase offerings for customers amid higher demand.
Heat recovery steam generator technology, a key component of a combined-cycle power plant, converts water into steam by capturing the exhaust heat from a gas turbine. The steam is then used to drive a steam turbine to produce more power.
GE is in the process of shedding its banking business and has been shifting back to an industrial base. In November 2015, GE said it completed its long-running acquisition of Alstom SA
’s power business. Alstom Power and GE Power & Water combined to form GE Power.
In April, GE posted a quarterly decline in operating income and orders for its core industrial businesses, as a global oil-market rout continued to weigh on the company’s performance. Profit in the power business, excluding Alstom, fell 28% in the first quarter, but the company expects revenue and earnings to rise in the second half of the year.
Shares of GE, which have fallen 2.9% so far this month but are still up 9.2% from a year ago, were inactive premarket.
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