(By Balaseshan) General Electric Co. (NYSE: GE) is in talks to buy Italy's Avio SpA from buyout firm Cinven Ltd. that rejected offer from two private-equity funds, according to a report from Bloomberg.
CVC Capital Partners Ltd. and Clessidra SGR SpA doesn't plan to revise their offer of about $3.9 billion for Avio, leaving GE to pursue the acquisition, the Bloomberg reported citing people familiar with the discussions.
Cinven is also considering holding an initial public offering of Avio next year, the people told the Bloomberg.
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Cinven began preparing Avio for a sale last year when it hired banks to manage an IPO of the company, according to the Bloomberg. Cinven purchased Avio, based in Turin, Italy, in 2006 from Carlyle Group (NASDAQ: CG) and Finmeccanica SpA in a deal that valued the company at about 2.6 billion euros.
In 2003, the Fiat Group sold Fiat Avio S.p.A. to a consortium formed by Carlyle Group and Finmeccanica. At the time, Fiat Avio was valued at 1.5 billion euros and changed its corporate name to Avio SpA.
GE is a diversified technology and financial services company. The products and services of the company range from aircraft engines, power generation, water processing, and household appliances to medical imaging, business and consumer financing and industrial products. Its segments include Energy Infrastructure, Aviation, Healthcare, Transportation, Home & Business Solutions and GE Capital.
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GE closed Wednesday's regular session at $20.68. The stock has been trading between $14.68 and $23.18 for the past 52 weeks.