Bank of America to buy $2.6 billion in GE shares
Bank of Ameritrade says it will buy $1.9 billion in stock from GE in a deal that could be worth $2 billion to $2,000 per share.
The deal is part of a larger GE buying spree that could include a stake in the bank’s new chip-maker, according to Recode.
The bank says the deal will value GE’s chips at $3 billion to more than $5 billion.
GE shares fell more than 2 percent to $29.95.
GE says the chipmaker plans to create 3,000 jobs in North America and plans to invest in its new chip technology.
GE chief executive officer Brad Smith said the company will invest in “the long-term growth of our chip business, which will be driven by technology that is aligned with the future of our customers and businesses.”
The stock rose as much as 10 percent on Tuesday.
GE said the chip company will receive $1 billion in cash, including a $600 million cash-and-stock grant.
“The acquisition will create an entirely new company with an unmatched combination of global scale and global leadership, with a broad portfolio of technologies and technologies that will accelerate GE’s growth,” GE said in a statement.
GE is also buying about $1 million in stock in the chip maker and its parent, Advanced Micro Devices, and the chip giant expects the deal to close in the third quarter of 2019.
GE has struggled to stay ahead of the pack as companies like Apple and Amazon ramp up chip manufacturing and technology.