GE’s Materials Business to Be Sold for $3.8 Billion

General Electric Co. said Thursday that it would sell most of its advanced materials unit for $3.8 billion in the latest move to reshape one of the world’s largest companies.

The industrial, financial services and media conglomerate said that after the sale to private investment group Apollo Management it would retain a 10% stake in the unit, which has annual revenue of $2.5 billion and makes silicones and quartz products used in industrial applications.

The company will also hold $400 million in notes.

Fairfield, Conn.-based GE, which has more than 300,000 employees and annual sales of about $150 billion, plans to use the proceeds, estimated at about $2 billion, to restructure its industrial business.

The deal “is another big step in repositioning the industrial segment for faster growth and higher returns,” the company said.

GE, which expects to complete the sale before the end of the year, has been selling slower-growth businesses such as insurance to focus on faster-growth areas such as consumer and commercial finance.

“I think it was a wise sale,” said Robert Schenosky, an industrial analyst with Jefferies & Co. in New York.

But Schenosky said he would like to see GE adopt a broader strategy to sell more slower-growth businesses. He named plastics, appliances and lighting as potential divestitures.

“We’d like to see a more aggressive approach to those businesses,” Schenosky said.

GE executives say they continually evaluate the portfolio, but they note that the appliance business has enjoyed a resurgence in recent years.

The advanced materials unit is based in Wilton, Conn., and has 5,000 employees in 38 locations worldwide.

Shares of GE fell 6 cents to $34.78. The stock has traded in a 52-week range of $32.06 to $36.34.

Apollo has acquired several businesses recently, including companies that make gears, chains and other industrial components, plastics and adhesives.