On the heels of United Technologies Corp. avowed merger bent, cross-state rival General Electric Co. says it could spend up to $30 billion on takeovers over the next two to three years, a top executive said, in a sign the Fairfield-based conglomerate is coming out of its recessionary defensive crouch, Reuters reports.
But John Rice, one of four vice chairman of the largest U.S. conglomerate, cautioned that the number he described as “$30 billion-ish” is not a commitment to spending. It would be compatible, he said, with GE’s plans to boost its dividend and buy back more shares, including the preferred stake it sold to Warren Buffett’s Berkshire Hathaway Inc. in October 2008 during the credit crisis.
“That doesn’t mean that we’ll spend that money; it doesn’t mean that we won’t do more with the dividend or with the buyback,” Rice, who heads the company’s technology infrastructure unit, told an investor conference in New York.
“If we were to conclude that there aren’t the deals out there that make sense, we might do less than that. We’re not going to chase bad deals just so that we can say we spent ‘X’ billion on M&A,” he said.
The statement, which surprised some investors, was the latest sign that mergers are coming back in a big way in corporate America, after a few years when companies were more concerned about conserving their cash.
UTC Chairman and CEO Louis Chenevert said Wednesday the Hartford conglomerate is interested in making acquisitions, particularly of makers of fire and security equipment, but only if the price is right.
