ABB buys GE unit for $2.6 billion to boost North American business

FILE PHOTO: The logo of Swiss power technology and automation group ABB is seen in Baden, Switzerland June 23, 2017.

ZURICH - ABB is buying General Electric’s Industrial Solutions unit for $2.6 billion to expand its reach in North American markets, the Swiss engineering company said on Monday.

Zurich-based ABB sees a potential for cost synergies of $200 million yearly with the deal, which includes terms for long-term use of GE’s brand. In 2016, Industrial Solutions had sales of about $2.7 billion, with an operating margin of some 8 percent.

GE had resumed negotiations to sell the business to ABB after the U.S. industrial conglomerate moderated its price expectations, people familiar with the matter told Reuters in August.