Transportation equipment and services provider Wabtec Corp. has completed its planned merger with GE Transportation, the former rail unit of manufacturing leader General Electric Co., and says the move establishes Wabtec as a global transportation and logistics provider with enough heft to be included in the S&P 500 Index of stocks.
The deal had been in the works since May 2018, when the two companies agreed to an $11.1 billion merger they said would create a rail manufacturing giant.
Pittsburgh-based Wabtec said the finished merger now combines its broad range of freight, transit and electronics products with GE Transportation's equipment, services and digital solutions in the locomotive, mining, marine, stationary power and drilling industries.
Rafael Santana, who had served as president and CEO of GE Transportation, is now president and CEO of Wabtec's Freight segment.
The combined company is expected to have revenues of more than $8 billion in 2019 and to boast an installed base of more than 23,000 locomotives globally, an expanded global reach, a strengthened mix of products and services, and enhanced capabilities to drive innovation in key growth areas, the firms said.
Under the terms of the deal, parent company GE received $2.9 billion in cash at closing, after it sold a portion of GE Transportation assets to Wabtec, spun off a portion of GE Transportation to GE shareholders and then fostered a merger between GE Transportation and a wholly owned subsidiary of Wabtec. The final result is that Wabtec shareholders own 50.8 percent of Wabtec, GE shareholders own 24.3 percent of Wabtec, and GE owns a 24.9 percent economic interest in Wabtec, the firms said.
