Wednesday, June 24, 1998 Published at 08:40 GMT 09:40 UK
Business: The Company File
GEC and Siemens split the spoils
GEC wants to focus on its three core businesses
The General Electric Company is taking full control of Britain's largest telecoms equipment manufacturer GPT after buying a 40% stake worth £700m from German electronics giant Siemens.
In exchange Siemens will receive and paying £610m in cash and take full control of another joint venture, Siemens GEC Communication Systems.
GEC already owns 60% of GPT, the maker of fibre-optic networks, payphones and smartcards, and is buying the remaining stock from its joint venture partner.
It will be combined with GEC's defence and telecoms subsidiary Marconi SpA to form Marconi Communications.
The creation of Marconi Communications would "unlock a range of value enhancing opportunities" including improved products, services, new strategic partnerships, cost savings and higher profits, GEC said.
Back to basics
Lord Simpson, managing director of GEC, said: "The formation of Marconi Communications demonstrates our responsiveness to the needs of our customers and creates a strong unified platform which will aggressively expand GEC's interest in this fast-growing global market.
"GEC has become a more streamlined group, focused on three core business areas of defence electronics, communications and industrial electronics."
The deal marks a winding down of GEC's joint ventures of its UK and German operations.
Sandro Gualano, managing director of Marconi SpA, will become chairman of Marconi Communications, while Tony Cobbe, managing director of GPT, will become chairman of GEC Business Development.
The Company File Contents