DETROIT (AP) - General Motors Corp. said Thursday it has agreed to sell its Allison Transmission commercial and military business for about $5.6 billion to the private equity firm The Carlyle Group and Canada's Onex Corp.
GM shares rose 2 percent in morning trading.
The deal is part of an effort by GM to raise money and focus on its core business. It has been losing ground in North America to Asian automakers.
GM had said in January it was considering a sale of Allison.
The sale includes seven manufacturing plants in Indianapolis and its global distribution network and sales offices.
A production facility in Baltimore, which produces conventional and hybrid transmissions for pickup trucks and sport utility vehicles, will remain with GM.
The Detroit-based automaker said the deal is expected to close as early as the third quarter pending union and regulatory approval.
''This is another important step to strengthen our liquidity and provide resources to support our heavy investments in new products and technology,'' GM Chairman and Chief Executive Officer Rick Wagoner said in Thursday's statement.
''At the same time, this sale will position Allison for growth with strong partners in Carlyle and Onex, which have well-established track records of working effectively with their management teams, unions and employees.''
The Carlyle Group is a Washington, D.C.-based private equity firm. Onex Corp. is a Toronto-based investment conglomerate.
GM shares rose 75 cents to $38.16 in morning trading after briefly touching a 52-week high of $38.50.
