Who is picking up GE businesses? Service provider, process supplier . . .

The businesses GE is selling are being picked up by a range of companies -- equipment firms, service providers and process providers that have an equipment stake. It would seem that the integration of engineering products GE attempted through its various acquisitions in the 2000s can possibly work only for a company like GE. With the dash for gas giving GE an edge, the OEM had acquired various companies in an effort toward growing into a broad-based energy equipment supplier. In a tough market, GE is now shedding those companies and focusing on its current core businesses -- power, renewables and aviation.

Process synergyFor instance, Air Products, a process vendor that has expertise in supplying turboexpanders, has acquired the Rotoflow turboexpander business from Baker Hughes. Turboexpanders play a critical role in liquefaction of natural gas that Air Products specializes in. This acquisition extends Air Products’ existing world-scale industrial gas and liquefied natural gas (LNG) turboexpander capabilities into growing hydrocarbon, petrochemical and energy segments. “Air Products already provides key proprietary equipment, services and industrial gases to many existing Rotoflow customers, and we are looking forward to expanding those relationships,” said Air Products’ Executive Vice President Dr. Samir J. Serhan.

Air Products has designed and manufactured over 1,600 turboexpanders as an integral part of large industrial gas and LNG projects. Recent projects include the world’s largest industrial gases facility in Jazan, Saudi Arabia and the proprietary LNG technology provided for the floating liquefied natural gas projects off-shore Malaysia.

The combination of the existing Air Products and Rotoflow turboexpander capabilities will be integrated into a new Air Products business division known as “Rotoflow, an Air Products Business.”

Rotoflow was acquired from Atlas Copco in 2000 and the equipment's target applications such as LNG did not quite fit in with the broader product profile of Atlas Copco. BHGE has said it will continue to supply turboexpanders that come from Nuovo Pignone under that trade name.

IGCC in the back-burner

In the 2000s, GE had signalled its focus on coal gasification by acquiring the Texaco gasifier in 2014. The acquisition seemed to indicate that the time for commercialisation of coal gasification had indeed come. Over time, GE developed an inhouse IGCC product including the gasifier and the combined cycle plant. But IGCC as a commercial venture is yet to take off in a significiant way. And GE has decided to hive off its gasification business that has been acquired by Air Products. This transaction will allow Air Products to expand its synthesis gas (syngas) solutions product offerings and its presence in build, own and operate gasification projects around the world.

“Acquiring GE’s gasification technology and business would complement our other recently completed gasification technology acquisition and alliance formation. Together, they would give Air Products a broad range of product and service offerings and solutions to provide syngas for chemicals, fuels, power or refining. Together, the transactions would allow us to further extend our onsite industrial gas production model to include syngas supply, and enable cross-selling opportunities for our other technologies and product offerings,” said Seifi Ghasemi, chairman, president and chief executive officer at Air Products.

As part of Air Products’ overall syngas solutions offering, these cross-selling opportunities could include air separation units, pressure swing absorbers, carbon monoxide cold box equipment, as well as generate other business opportunities in plant support and cryomachinery.

The gasification business being acquired by Air Products includes GE’s share of its 50/50 joint venture (JV) with China Shenhua Coal to Liquid and Chemical Company, Ltd., a subsidiary of China Energy Group, a world-class energy company. The JV, formed in 2011, provides technologies for gasification projects in China. The acquisition also includes over 1,000 patents relating to GE’s gasification technology, which has been deployed at over 90 sites, with over 240 gasifiers, and represents over 36,000 MWth (thermal megawatts) of syngas production. The GE gasification technology has an extensive track record of processing solid, liquid, gaseous, and blended feedstocks. Air Products looks forward to continuing to support existing and future gasification licensees. Gasification technologies offer a way to take varied lower-value feedstocks and convert them in a lower-emission manner into syngas. Air Products can then provide this syngas to customers to make higher-value products.

In the company’s sale-of-gas business model, Air Products finances, builds, owns, operates and maintains the gas production plant, so its customers can focus their attention and capital on their primary business. Ghasemi cited examples of the larger-scale, multi-billion-dollar gasification projects that are enabled and supported by the company’s gasification technology acquisitions. The large projects include, for example, the Lu’n, Juitai and Yankuang Group projects in China, as well as the Jazan project in Saudi Arabia.

Aftermarket pickings

Earlier this year, Rotating Machinery Services, primarily an aftermarket service provider, acquired the AC Compressor and Conmec Compressor business from GE. The acquistion would mean serving the aftermarket of these legacy machines. AC Compressor has a history dating back to 1931 under the former Allis-Chalmers nameplate. The modern incarnation of AC Compressor began in 1985 in Appleton, WI. Complementary brand Conmec started in 1987, offering solutions and hardware for all vendor turbomachinery nameplates. AC Compressor acquired Conmec in 1997. In 2001, GE acquired both businesses. The AC Compressor business services and repairs industrial compressors in the refining & petrochemical, industrial, onshore/offshore production and pipeline & gas processing industries. The product line consists of axial, centrifugal and oil-free-screw compressors, with a worldwide installed base of over 1200 machines.

Earlier this week, GE announced the completion of the sale distributed gas power business including Jenbacher and Waukesha. Advent International that bought the business for $3.25 billion has rebranded itself as Innio. GE acquired Jenbacher in 2003. Today, there are more than 20,000 Jenbacher engines.