U.S. firms concentrate on their core assets

Article Excerpt

GENERAL ELECTRIC CO. $14 (New York symbol GE; Manufacturing & Industry sector; Shares outstanding: 8.7 billion; Market cap: $121.8 billion; Dividend yield: 3.4%; Takeover Target Rating: Lowest; www.ge.com) is a leading maker of industrial machinery, including jet engines; power plant equipment; and locomotives. It also makes medical gear and lighting products. Under a new long-term strategy, GE plans to narrow its focus to three main businesses: electrical power equipment, aviation, and healthcare. In addition, the company plans to sell most of its remaining operations. It expects those sales to generate total proceeds of $20 billion over the next two years. As part of that plan, the company recently agreed to merge its locomotive business with Wabtec Corporation (New York symbol WAB). First, GE will spin off that business and hand its investors shares in the new company. As an independent firm, the locomotive business will then merge with Wabtec. After the deal closes, GE will own 9.9% of the combined firm, while Wabtec will hold…