|
GE cuts jobs, makes deal
|
 |
December 18, 2001: 2:08 p.m. ET
Cuts 3,000 at GE Capital, announces $777M purchase of Interlogix.
|
|  |
|
|
| | |
|
|
|
|
|
|
|
GE Capital sets $4B deal - Dec. 17, 2001
|
| |
|
|
|
NEW YORK (CNN/Money) - A day after affirming earnings projections for 2002, General Electric Co. announced a $777 million acquisition but also said its GE Capital unit cut 3,000 jobs.
GE said Tuesday it laid of 3,000 workers from its financial services business as part of a restructuring plan to save $300 million.
A spokesman for the company said it has also added 1,000 collectors to GE Capital, and the job cuts were designed to improve efficiency at an already profitable unit.
The company said that for the entire year it has cut 22,000 jobs, but those have been balanced out by job additions.
GE (GE: up $1.52 to $39.82, Research, Estimates) shares jumped more than 4 percent in afternoon trading after the company raised guidance for 2002 earnings growth Monday night.
GE said for 2002 it expects earnings of $1.65 to $1.67 per share, which includes a gain of 4 cents to 6 cents per share for the effect of a change in accounting for goodwill and a lower estimate of long-term returns on pension assets. On average, analysts surveyed by First Call were expecting the company to earn $1.59 per share.
GE CEO Jeff Immelt said Tuesday the company will also aggressively pursue acquisitions next year, with weak economic conditions presenting excellent buying opportunities.
Underscoring this point, the company said Tuesday that it would buy Interlogix Inc., the second acquisition GE has announced in as many days.
GE's Industrial Systems division announced it would buy electronic security company Interlogix in a $777 million cash-and-stock deal, giving GE access to a market ready for growth amid heightened demand for security products.
GE Industrial Systems, a maker of manufacturing products used to distribute and control electrical power, said it would pay $38.86 per Interlogix share -- half in cash and half in stock. Interlogix has about 20 million shares outstanding, according to its most recent earnings statement.
A shareholder owning 80 percent of Interlogix's (ILXI: up $9.81 to $38.52, Research, Estimates) outstanding stock has signed an agreement to tender the shares in favor of the transaction, GE Industrial Systems said.
The deal should close in the first quarter of 2002.
On Monday, GE Power Systems said it bought some operations and assets from Honeywell International Inc (HON: Research, Estimates). 
-- from staff and wire reports
|
|
|
|
|
|
|
