General Electric hopes to bolster its renewable energy operations by acquiring a prominent manufacturer of blades for wind turbines.
The company plans to pay $1.65 billion for Denmark-based LM Wind Power. GE anticipates that LM — currently owned by London private equity firm Doughty Hanson — will remain a standalone unit within GE Renewable Energy.
Officials, however, said that incorporating LM's design, manufacturing, service and logistics capabilities would enable the company to bolster renewable energy production and further reduce wind power costs.
"This deal will merge the speed and focus of LM Wind Power’s entrepreneurial culture with GE’s world-class engineering and operational capabilities," LM CEO Marc de Jong said in a statement.
LM developed into a leading wind energy supplier over its three decades and holds 190 patents, GE said. It operates 13 factories in Denmark, the U.S., Canada, China, India, Brazil, Spain and Poland.
GE officials noted that wind accounted for more than one-third of new electrical capacity added last year, and that renewable energy overall accounted for half.
"Simply stated, we’ll be more local, have more flexibility and knowledge in turbine design and supply, and more ability to innovate and reduce product costs, while improving turbine performance," said GE Renewable Energy President Jérôme Pécresse.