General Electric Co. has completed the US$11.6 bln sale of its plastics division to Saudi Basic Industries Corp. (SABIC). In recent years, GE Plastics' performance results have afflicted by the rising costs of natural gas and raw materials since 2004. Profits for the division fell by 22% to US$674 mln in 2006.
The deal is expected to create a net gain, after taxes, of US$1.5 bln. The sale is part of the conglomerate's strategy to sell slower growth and volatile businesses such as insurance, and invest in high-growth, high-technology businesses such as health care and water processing technology.