NEW YORK, May 21: US conglomerate General Electric said on Monday it had agreed to sell its global plastics division, GE Plastics, to state-controlled Saudi Basic Industries Corporation (SABIC) for $11.6 billion.

GE Plastics is a global supplier of plastic resins used in numerous industries, including the automotive, healthcare, building and construction, and telecommunications sectors.

The deal was announced jointly by GE chairman and chief executive Jeff Immelt and SABIC CEO and vice chairman Mohamed Al-Mady, and follows intense press speculation that such a deal was in the works.

“This acquisition represents another important step in SABIC's growth and diversification to become one of the world's leading manufacturing companies,” Al-Mady said.

The transaction marks one of the largest acquisitions of a Western business by a Middle East company.

SABIC is the largest public company in the Middle East by market capitalisation, currently around $80 billion, and one of the world's 10 biggest petrochemicals manufacturers.

“This business is complementary to our existing business without any overlaps. SABIC's intention is to grow the business globally,” SABIC's CEO added.

SABIC's headcount will balloon to almost 30,000 staff from over 19,000 following the closing of the deal.

The Saudi firm's US arm, SABIC Americas, is based in Houston, Texas, and already has notable operations in the United States, but the deal with GE will significantly enlarge its global footprint, including in the growing markets of China and India.

The Saudi firm has had long-term relationships with other big energy groups including ExxonMobil and Royal Dutch Shell.

“With a strong reputation as a safe, responsible and efficient operator of large, state-of-the-art chemical plants, coupled with a commitment to investment in technology, SABIC is the smart choice to grow the GE Plastics unit,” GE's Immelt said.The deal follows in the footsteps of SABIC's acquisition of the DSM Petrochemicals business in Europe and the Huntsman Petrochemicals business in Britain.—AFP