BOSTON (CBS/AP) — General Electric is selling its biopharma business to Danaher Corp. for $21.4 billion as it continues to sell off chunks of a once sprawling conglomerate.

The news comes on the heels of GE announcing plans to downscale in Boston. The company said earlier this month that it would not build its headquarters in the Fort Point neighborhood. GE also plans to reimburse the state of Massachusetts for the incentives it used to woo the company from Connecticut three years ago.

Gov. Charlie Baker, GE’s Ann R. Klee, GE CEO Jeff Immelt, and Boston Mayor Marty Walsh at the groundbreaking ceremony for General Electric’s Innovation Point campus, May 8, 2017. (Photo credit: Anaridis Rodriguez/WBZ-TV)

The biopharma unit, part of GE Life Sciences, generated revenue of about $3 billion last year. Danaher said after tax benefits, the deal will have a price tag that is closer a $20 billion. The mostly-cash transaction is expected to close in the fourth quarter of this year.

Danaher, a medical technology company based in Washington, D.C., said GE’s biopharma segment will operate as a separate company within Danaher’s $6.5 billion Life Sciences division.

GE has shrunk considerably since becoming entangled in the financial crisis a decade ago and is seeking to divest even more of its businesses. Last fall, GE sold part of its Healthcare Equipment Finance business to TIAA Bank and agreed to sell its Current, powered by GE business — part of the company’s lighting business — to American Industrial Partners.

In October, the company slashed its quarterly dividend and announced it was restructuring its power business shortly after ousting CEO John Flannery after only about a year on the job. After being named as the new CEO, Larry Culp said GE needed to simplify its business structure even more.

It also dropped plans to build a 12-story office tower on the city’s waterfront that was to be the centerpiece of its new global headquarters. It will sell that parcel of land along with two older, state-owned buildings that were being refurbished for the company.

Despite ongoing struggles in its power division, GE posted better-than-expected revenue last quarter on the strength of its other business segments.

Shares of GE jumped nearly 17 percent before the opening bell Monday. The company’s shares have risen about 34 percent since the beginning of the year, but are still down almost 30 percent from a year ago.

(© Copyright 2019 CBS Broadcasting Inc. All Rights Reserved. The Associated Press contributed to this report.)

Comments

Leave a Reply

Please log in using one of these methods to post your comment:

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s