Smiths Aerospace, a global engineering firm specialising in aircraft control and computer systems, has been sold to US engine maker General Electric (GE).
The London-based firm agreed to the sale of its aerospace division for $4.8 billion (£2.5 billion). Following the sale, it has proposed a return of £2.1 billion to shareholders.
Announcing the sale, Smiths chief executive Keith Butler-Wheelhouse commended the work of its aerospace employees. He said their efforts in the development of aerospace technology were a major influence in the company being appointed to military and commercial programmes.
"The structure of the aerospace industry is changing – in particular its increased capital requirements and the growing importance of supplier scale, especially as the next generation of large programmes kicks in," he said.
Mr Butler-Wheelhouse said that the sale of the aerospace division will allow the Smiths Group to "crystallise" its value to shareholders. "At the same time we know that this business is going to a great owner," he said.
While the two companies have already agreed to the sale, the deal must be approved by Smiths shareholders. It is also conditional on the companies obtaining anti-trust clearances from the US government and the European Commission.
Smiths is planning to complete the deal during the second quarter of 2007.
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