GE Seeks Sale of Security Unit; May Fetch $2 Billion

General Electric Co. is seeking to sell its security unit, which builds surveillance cameras and alarms, and may fetch about $2 billion, three people with knowledge of the matter said.

GE hired JPMorgan Chase & Co. to find a buyer for most of GE Security, said the people, who declined to be identified because the talks are confidential. Fairfield, Connecticut-based GE asked potential buyers to submit preliminary bids about a month ago, the people said.

Possible acquirers include Tyco International Ltd. and United Technologies Corp., which also sell security equipment, the people said. GE may sell the unit in parts if it can’t find a buyer for the whole business, one of the people said.

“The security industry is extremely fragmented, and that is clearly different from GE’s typical vision of being in a strong market-leadership position,” said Joel Levington, director of corporate credit for Hyperion Brookfield Asset Management Inc. in New York.

Michelle May, a GE spokeswoman, declined to comment, as did Paul Fitzhenry of Schaffhausen, Switzerland-based Tyco; John Moran at United Technologies, based in Hartford, Connecticut, and JPMorgan’s Brian Marchiony.

GE fell 21 cents, or 1.5 percent, to $14.09 at 3:39 p.m. in New York Stock Exchange composite trading after earlier dropping as much as 2 percent. The shares declined 12 percent this year through yesterday.

Built With Acquisitions

GE Chief Executive Officer Jeffrey Immelt built the security division through acquisitions starting in 2002. GE Security projected $3 billion in sales by 2011, up from about $1.8 billion in 2007, Dean Seavers, the unit’s chief executive officer, said in an interview in September 2008.