(Reuters) - General Electric Co's (N:GE) financing arm said on Wednesday it will sell its energy finance unit and loan portfolio to Starwood Property Trust Inc (N:STWD) for $2.56 billion, as part of a plan to shrink itself into a smaller, more focussed business.
The 126-year-old industrial conglomerate has been divesting assets worth billions from its GE Capital unit since 2015 to focus on jet engines, power plants and renewable energy.
The agreement with Starwood also includes the transfer of a team of employees, GE Capital said.
The deal, expected to close in the third quarter, will add to Starwood's core earnings, the real estate investment trust said.
GE shares were marginally higher in premarket trading on Wednesday.
Citigroup (NYSE:C) Global Markets was financial adviser to GE Capital, and Shearman & Sterling LLP provided legal advice. Sidley Austin LLP and Paul Hastings LLP were legal advisers to Starwood.