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GE close to deal to buy SPX unit

/ Source: Reuters

General Electric Co. is close to striking a deal to buy SPX Corp.’s Edwards System Technology fire and security business for about $1.4 billion, the Wall Street Journal reported on Monday.

A deal could be announced as early as Monday though talks could still break down, people briefed on the matter told the newspaper.

Charlotte, North Carolina-based SPX, a diversified manufacturer, has said it is evaluating its businesses for potential divestitures.

Edwards accounts for about 15 percent to 20 percent of SPX’s overall operating income, according to the WSJ.

Both GE and French electrical equipment maker Schneider Electric were said to be considering bids for Edwards, according to people familiar with the matter, the WSJ said.

Calls to GE and SPX were not immediately returned for comment.

The Wall Street Journal also reported that SPX will be the target of a proxy fight by investment firm Relational Investors LLC, its third-largest shareholder. Relational expects to file proxy materials on Monday.

In a draft proxy statement, the firm says the SPX board adjusted a bonus plan to generate unjustified rewards for management and independent directors last year, according to the WSJ.

The proxy materials will also announce that the heads of Relational, Ralph Whitworth and David Batchelder, plan to run for seats held by directors facing re-election next year, the newspaper said.