GE Vernova to buy Trench for $9 billion in power-grid push, raises revenue forecast again

GE Vernova to Acquire Trench for $9 Billion, Raises 2026 Revenue Forecast

GE Vernova's Strategic Acquisition and Financial Outlook

Acquisition of Trench Group

Oct 28 (Reuters) - GE Vernova said on Wednesday it would buy high-voltage grid equipment maker Trench Group in a $9 billion deal from investment firm Triton Partners and raised its full-year revenue forecast for the third straight time.

Market Drivers and Industry Demand

Utilities are stepping up investment in power grids to meet surging power demand from data centers and industrial electrification, and to replace aging infrastructure, driving up demand for high-voltage transmission networks and related specialized equipment.

Expansion of Manufacturing Capabilities

GE Vernova said the acquisition would bolster its North American manufacturing of grid components through a newly opened Trench facility in Charlotte, North Carolina, where production of 765-kilovolt (kV) equipment is expected to begin in late 2027.

Financial Impact of the Acquisition

The power equipment maker expects Trench to generate about $1.9 billion in revenue and an adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) margin of roughly 36% in 2028.

The deal would also add manufacturing capacity and expand GE Vernova's reach across Europe and Asia, and give it access to Trench's backlog worth about $5 billion.

GE Vernova expects to split the purchase price equally between cash and debt, and close the transaction in late 2027.

Shares of the company were up 2.8% at $920.50 in premarket trading.

Revenue Forecast and Growth Drivers

Updated Revenue Projections

DEMAND DRIVES GROWTH

The company said it now expects revenue of $46.5 billion to $47.5 billion in 2026, compared with its prior estimate of $45.5 billion to $46.5 billion.

Quarterly Performance Highlights

Its third-quarter revenue rose 27% to $12.64 billion from a year earlier. GE Vernova's adjusted EBITDA in the quarter stood at $1.94 billion, above LSEG-compiled analysts' estimate of $1.68 billion.

Power orders nearly tripled on demand for gas turbines and services, while Electrification revenue climbed 51%, driven by higher sales of substation solutions, switchgear and transformers.

Orders surged more than 96% to $29 billion, lifting backlog to $197 billion.

Cost Management and Tariff Impact

GE Vernova said it now expects global tariffs to add less than $100 million to its 2026 costs, compared with a prior estimate of $100 million to $200 million.

(Reporting by Sumit Saha in Bengaluru; Editing by Tasim Zahid and Sriraj Kalluvila)