GE to Sell Mexican Mortgage Business - Analyst Blog

Headquartered in Mexico City, GE Capital, a unit of General Electric Company (GE), entered into an agreement to sell its consumer mortgage business in Mexicoto Grupo Financiero Santander Mexico. The business to be sold comprises GE's consumer mortgage portfolio worth $2 billion.

The transaction is expected to close in the first half of 2011, subject to regulatory approvals. The companies did to disclose the financial terms of the deal.

GE Capital has been providing consumer mortgages in Mexico since 2002; and the mortgage business has been a part of its Restructuring Operations organization since early 2009.

The acquisition strengthens Santander's scope in Mexico, making it the second largest provider of mortgages in the country. GE remains focused on Mexico, an important market for the company, and remains a leading supplier of commercial loan in tools and aircraft financing, real estate, transportation, structured and technology finance, and working capital.

GE's infrastructure businesses provide products and services that help the developing regions to participate in the global economy, while also assisting the developed regions to upgrade with cleaner, more efficient and better infrastructure technologies.

However, the company's global expansion is subject to economic and political risks pertaining to various operating geographies.

Operating in more than 100 countries globally and employing about 300,000 people worldwide, General Electric Co. is a diversified infrastructure, finance and media company. Within the energy sector, the company aims to develop and install technology for the efficient use of natural resources. Major competitors of General Electric are Honeywell International Inc. (HON), Siemens AG (SI) and United Technologies Corp. (UTX).

We currently maintain our Neutral rating on General Electric, with a Zacks #3 Rank (short-term Hold recommendation).