GE to buy out bomb-detector InVision for $900 million

General Electric on Monday said it has agreed to buy InVision Technologies, which makes bomb-detection equipment, for about $900 mn to expand its security technology business. Newark, California-based InVision designs equipment to detect explosives in passenger-checked luggage. Its shares have almost doubled in price in the past year as demand for its airport security products has soared.

A GE unit, GE Infrastructure, will pay $50 a share forInVision, whose shares closed at $41.22 on Nasdaq on Friday and jumped about 20 per cent in early trading on Monday. GE said its industrial growth businesses, which includes security, are showing revenue growth of more than 20 per cent from last year. The “increased visibility” will help GE reach the high end of its earnings target ranges for the first and second quarters, it said.

The acquisition of InVision will boost GE Infrastructure’s ability to provide airport, mass transportation, border and power plant security, the company said. GE is also focused on improving its security offerings for chemical plants, military bases and entertainment facilities such as Sports arenas.

InVision also designs X-ray technology to detect defects in industrial parts such as aluminum wheels, GE is paying about 8.5 times trailing earnings before interest, taxes, depreciation and amortisation for InVision. (Reuters)