With the new partnership, GE now owns a 15% stake in XD Electric and also holds one board seat. In addition, the partnership also includes the formation of a joint venture (JV) with XD to offer customers in China GE’s localized grid automation equipment and services.
The partnership was originally announced in May 2012 and will expands GE’s industry capabilities in transmission and distribution (T&D) solutions, which is estimated at $100bn.
Weil, Gotshal & Manges and Fangda Partners acted as GE’s lead legal advisers, while Citigroup as sole financial advisor.
Through the partnership, GE and XD will offer end-to-end T&D solutions to meet the growing demand for electricity in emerging economies.
GE Energy Management president and CEO Dan Janki said, "Our investment in XD Electric is core to our long-term strategy to build a world-class T&D franchise and become a leading provider of grid modernization solutions."
"By combining the strengths of both GE and XD Electric, we will offer full-scope solutions to customers in the rapidly growing T&D industry. The partnership will enhance our ability to compete in fast-growing regions such as China where XD Electric has a strong presence," Janki added.
XD chairman of the board Zhang Yalin said, "This partnership between XD and GE is a comprehensive collaboration focusing on technology, capital investment and segment exploration. "
"Combining strengths of both companies, the partnership will help XD meet the demands of the entire T&D segment for years to come. Additionally, by partnering with GE, we will be able to achieve our strategic objective of globalization sooner and become a stronger competitor in the global segment," Yalin added.
GE Digital Energy business president and CEO John Lavelle said, "With the world’s electricity demand expected to increase by more than 70 percent by 2035 and global grid modernization investments expected to grow by 10 percent over the next five years, we are better able to help utilities and industrial customers upgrade and expand their electrical infrastructure."
