(MENAFN- AFP) US industrial conglomerate General Electric announced Tuesday the sale of its lending business Sponsor Finance to the Canada Pension Plan Investment Board for $12 billion.
The acquisition target's Antares Capital has provided more than $120 billion in finance over the past five years to help firms buy others.
Its sale is part of GE's divestiture of all its banking assets in the wake of the 2008-2009 financial crisis in order to focus on its core industrial businesses.
"This announcement is the next step in GE's transformation to a more focused industrial company," GE Capital chairman and chief executive Keith Sherin said in a statement.
"The sale of Sponsor Finance aligns with our strategy to pair a smaller GE Capital with GE's long-term industrial growth."
The purchase will allow CPPIB to achieve scale and advance "the prudent diversification of our investment portfolio," according to CPPIB president and chief executive Mark Wiseman.
The transaction is subject to regulatory approval and is expected to be finalised during the third quarter of 2015.
Upon closing, Antares will operate as a standalone business, said the CPPIB.
Managing partners David Brackett and John Martin, who have led Antares since its formation, will remain with the firm.
At arm's length from the Canadian government The CCPIB invests in equities, real estate, infrastructure, and fixed income instruments for 18 million pension contributors.
It currently manages Can$264.6 billion in assets.
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