GE agreed to sell its BioPharma business to Danaher for a total consideration of $21.4 billion, including $21 billion in cash as well as Danaher’s assumption of certain pension liabilities.

GE expects to use the proceeds from the transaction to reduce leverage and strengthen its balance sheet.

The transaction is expected to close in the fourth quarter of 2019, subject to regulatory approvals and customary closing conditions.

PJT Partners, JP Morgan Securities, Citigroup Global Markets and Goldman Sachs acted as financial advisors to GE on the transaction

GE Chairman and CEO H. Lawrence Culp, Jr. said, “Today’s transaction is a pivotal milestone. It demonstrates that we are executing on our strategy by taking thoughtful and deliberate action to reduce leverage and strengthen our balance sheet. We are retaining full flexibility for growth and strategic optionality with one of the world’s leading healthcare companies, and we are pleased that our BioPharma colleagues will join a strong, established team at Danaher. A more focused portfolio is the right structure for GE, and we have many options for maximizing shareholder value along the way.”

GE Healthcare President and CEO Kieran Murphy said, “The BioPharma business has been a strong contributor to our success, and I am confident this agreement represents a great opportunity for our valued colleagues to flourish under the ownership of Danaher. GE Healthcare has unsurpassed scale and scope and we will continue to focus on our investments so that we deliver better outcomes and more capacity to a world striving for Precision Health.”

The BioPharma business being divested is part of GE Life Sciences. In 2018, the BioPharma business generated revenues of approximately $3 billion. It provides instruments, consumables and software that support the research, discovery, process development and manufacturing workflows of biopharmaceutical drugs.

Pharmaceutical Diagnostics, currently part of GE Life Sciences, will remain within the GE Healthcare portfolio.

The transaction is not subject to a financing condition or a shareholder vote.

Paul, Weiss, Rifkind, Wharton & Garrison acted as GE’s legal advisor on the sale.