US technology giant General Electric (GE) has sold its business-to-business ecommerce company in a deal worth around $800m.
GE Global eXchange Services (GXS) has been sold to Francisco Partners which said it plans to acquire other companies and staff to build up the ailing GXS brand.
Harvey Seegers, current president and chief executive at GXS, will continue to lead the company and GE will retain a 10 per cent stake in the firm.
Seegers believes that GXS will prosper as a part of the Francisco portfolio. "When you're a small part of a big company, you're almost always standing at the end of the line when capital requests are being considered," he said.
"In this particular case, at a technology fund, you're almost always at, or near, the front."
With a presence in 58 countries, GXS has engineering teams in the US, Ireland, the UK, India and the Philippines, and has a customer list that includes Eastman Kodak, DaimlerChrysler and 3M.
Francisco will acquire access to over 100,000 trading partners currently operating with GXS, including 60 per cent of the Fortune 500 firms, according to GE.
The deal will be closed by 31 October and the divestiture is expected to result in a pre-tax gain of approximately $500m to GE, the company said.
Francisco claims that over the past five years it has invested in excess of $1bn in over 20 technology and technology-related companies with a combined enterprise value exceeding $4bn.
The company specialises in taking over subsidiaries of major corporations that are no longer considered core by their parents. Francisco then provides what it calls "transformational capital" to try and create a thriving concern.
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