According Bloomberg reports on Tuesday, diversified conglomerate United Technologies Corp. (UTX) is nearing a deal to acquire the security business of diversified technology, media, and financial services company General Electric Co. (GE) for nearly $2 billion. The deal is expected to be announced before the weekend, the report stated. GE Security was put up for sale in July, and GE had hired JPMorgan Chase & Co (JPM) as its financial adviser, to find a buyer for the unit.
GE Security is a wholly owned subsidiary of Fairfield, Connecticut-based General Electric and a business unit of GE Enterprise Solutions, focused on communication and information technologies for security, safety and lifestyle enhancements. GE Security has operations in more than 30 countries and is represented by some of the best-known brand names for intrusion and fire detection, access and building control, video surveillance, explosive and drug detection, key management and, structured wiring.
According to reports in August, the potential buyers for the GE unit included its rivals in the security sector such as Tyco International Ltd. (TYC), United Technologies, and Germany's Robert Bosch GmBH. The reports also stated that the company is willing to break up the security unit and sell bits and pieces, in case it is unable to find a buyer for the entire business.
In April, Paris-based Safran SA (SAFRF.PK) agreed to take over 81% majority stake in GE Security's Homeland Protection business, that sells technology for airports, for $580 million, with GE Security retaining the remaining 19%. GE Security is focused on communication and information technologies for security and life safety solutions. Its Homeland Protection business is focused on explosives and narcotics detection. This business has around 780 employees located in the U.S., Europe, and Asia.
Hartford, Connecticut-based United Technologies is said to be focusing on the fire and security division. GE acquired the division in the $1.4 billion purchase of fire detection equipment maker Edwards Systems Technology from SPX Corp. in 2005. The acquisition of the division would help United Technologies to add more than $6 billion in annual sales in the area, in order to expand in a sector that it estimates to be worth about $100 billion.
GE last year noted that the attraction of the security division is its forecast for increased sales in emerging markets and new offerings that bundle video surveillance, alarms and fire systems. The company projected $3 billion in sales by 2011 at GE Security, higher than about $1.8 billion in 2007.
GE has had a tough time during the recession. With demand on the downhill, its manufacturing side has suffered, and the financial arm GE Capital saw defaults mounting. There has also been speculation that the company might consider spinning off the finance unit as President Barack Obama's reform proposal on the finance sector could relax GE's control over its finance arm. GE Capital has invested heavily in real estate, which is suffering from the economic crisis, another cause of worry for the company and investors.
Last month, GE reported a plunge in third-quarter profit as the company's revenues declined 20% from last year, hurt mainly by the Capital Finance segment that saw its Commercial Lending and Leasing, Consumer and Real estate activities being hit by the economic woes. Net earnings were $2.419 billion or $0.23 per share, compared to $4.312 billion or $0.43 per share a year ago. Quarterly revenues dropped 20% to $37.80 billion from $47.23 billion posted last year.
GE is also recently finalizing a bigger deal to spin off its media and entertainment arm NBC Universal television, and movie unit into a joint venture controlled by the cable operator Comcast Corp. (CMCSA). The two companies have reportedly agreed recently to value the businesses at about $30 billion, and are in the process of ironing out the final details of the deal.
GE and Comcast are reportedly looking to finish the agreement within the next two weeks, and the resulting entity would have a net $9 billion in debt. Both companies want the venture to be investment grade. The deal may take as long as a year to pass U.S. regulatory approval, reports noted. If successful, the venture will create a media giant.
UTX closed Tuesday's regular trading session at $66.73, down $0.01 on a volume of 3.55 million shares, lower than the three-month average volume of 5.0 million shares, while GE closed at $15.78, down $0.07 or 0.44% on a volume of 73.60 million shares, lower than the three-month average volume of 101.34 million shares.
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June 12, 2026 17:14 ET Major central bank action was the focus this week in economic news. The European Central Bank became the first major central bank to move in response to the rising inflationary pressures in the backdrop of the conflict in the Middle East. In North America, the U.S. inflation and trade data as well as Canada’s central bank decision gained attention. The Chinese trade data was the main news in Asia.