GE Capital’s energy portfolio has about 20 investments in renewable energy, contracted natural gas fired generation and midstream energy infrastructure assets
New Delhi: Apollo Global Management LLC on Monday agreed to buy a $1 billion portfolio of equity investments in energy assets from General Electric’s finance arm GE Capital, as the U.S. conglomerate looks to narrow its focus on its industrial roots.
GE Capital’s energy portfolio has about 20 investments in renewable energy, contracted natural gas fired generation and midstream energy infrastructure assets, primarily in the United States, the U.S. private equity firm said in a statement.
GE, which replaced its Chief Executive Officer John Flannery in a surprise move earlier this month with outsider Larry Culp, has been divesting assets worth billions from its finance unit since 2015 to focus on jet engines, power plants and renewable energy.
Financial details of the deal, which is expected to close in the fourth quarter of 2018, were not disclosed.
For Apollo, the deal comes amid a recovery in energy prices.
Reuters reported in April that the private equity firm was seeking to raise more than $4 billion for its third natural resources-focused private equity fund.
RBC Capital Markets, Goldman Sachs and Bank of Montreal provided financing to Apollo for the deal.
Citigroup Global Markets Inc, RBC Capital Markets and Goldman Sachs were financial advisers to Apollo, while Bank of America Merrill Lynch and PJT Partners advised GE Capital.
GE’s shares were up about 2.8 percent at $13.54 in early trading, while Apollo’s shares were little changed at $33.68.
Up to Friday’s close, GE’s stock had risen about 16.7 percent since Sept. 28, the last trading day before the company announced Culp as the new CEO.