By Jui Chakravorty Das
CHICAGO (Reuters) - General Electric Co's (GE.N: Quote, Profile, Research, Stock Buzz) infrastructure unit will likely make several acquisitions in the power storage, power management and control systems sectors in 2008, the unit's chief executive said on Monday.
"We have a pipeline of 20 to 30 companies that we are looking at all the time," John Rice, a GE vice chairman who is chief executive of GE's largest unit, told the Reuters Manufacturing Summit in Chicago in a telephone interview.
"So we call through this list ... and engage in discussions on a regular basis. It is possible there will be several ... important $300 million to $500 million bolt-on acquisitions this year," Rice said. "Particularly the ones that are preparing to put themselves up for auction."
GE Infrastructure, whose products range from jet engines to electricity-producing gas turbines, last year generated $57.9 billion in revenue and has forecast 15 percent growth this year.
"That growth rate is just organic," Rice said. "Any acquisitions would be over and above that."
With the credit crunch drying up the flow of private equity money, Rice said this was a "good time" for the company to be making deals.
Interest from private equity firms had pushed takeover prices sky-high -- but the credit squeeze has made it harder for the firms to borrow for takeover bids, forcing down asset prices.
"Certainly some of the crazy prices should be less crazy," Rice said. "There is going to be a value on synergy so strategic buyers like ourselves can truly take advantage." Continued...
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