GE to buy 15% stake in China's XD Electric

General Electric Co said it will buy a 15 percent equity stake in China XD Electric Group for about $535 million and will partner with XD to provide technology to build and upgrade electrical systems.

GE, which is expanding in China as the growing middle class requires more electricity, said the companies will deliver electric transmission and distribution (T&D) and grid automation solutions to customers globally.

The joint venture gives GE access to "primary" equipment such as large transformers and breakers that modify and switch power within the grid, Bob Gilligan, president and chief executive officer of GE's digital energy business, said in an interview.

XD Electric in China, one of the fastest growing T&D markets in the world, has developed technology used on a large scale for a competitive portfolio of products, he said.

"GE is continuing to look for alternative ways to grow and expand its business," said Gilligan. "This investment helps us better serve energy-intensive industries like utilities, like mining, like steel."

GE, the largest US conglomerate, will also appoint a representative to XD's board of directors.

XD Electric, traded on the Shanghai stock exchange, manufactures electricity transmission and distribution equipment. It exports products to more than 40 countries and regions throughout Europe, the United States, Asia and Africa.

GE shares were off 0.3 percent at $19.29 on the New York Stock Exchange on Monday morning, near the top of the past year's range between $14.03 and $20.42.