Mumbai: General Electric Co. has agreed to sell its struggling GE Plastics business to petrochemicals manufacturer Saudi Basic Industries Corp. (SABIC) in an $11.6 billion all-cash deal.

Fairfield, Connecticut-based GE said it would receive net after-tax proceeds of about $9 billion, which would primarily be put toward the company's current stock buyback.

"This transaction is another important step in the execution of this strategy, which has created a faster-growing, higher-returning set of businesses capable of delivering sustained performance," GE chairman and chief executive Jeff Immelt said in a statement.

GE had put its plastics business up for sale after starting the year by negotiating $15 billion in takeovers, including parts of health-care company Abbott Laboratories Inc., the aerospace business of Britain's Smiths Group Plc and privately held oil and gas field equipment maker Vetco Gray.

Riyadh-based chemicals company, Saudi Basic Industries Corp (SABIC) said it intends to grow the business globally, and is not planning work force reductions.

"This business is complementary to our existing business without any overlaps," said Mohamed Al-Mady, vice chairman and chief executive of the petrochemicals manufacturer.

GE's plastics division dates to 1930, resulting directly from Thomas Edison's experiments with plastic filaments for light bulbs in the 1890s. It grew into a significant GE venture where Immelt worked before becoming CEO.

Pittsfield, Massachusetts-based GE Plastics supplies plastic resins used in industries such as automotive, health care and consumer electronics. It employs 10,300 people and GE values the business at about $6.65 billion.

The division has struggled since 2004 because of rising costs of natural gas and raw materials such as benzene. GE Plastics last year reported a 22 per cent drop in profit at $674 million while it generated $6.65 billion in revenue.

The deal is expected to close in the third quarter. Afterward, Brian Gladden, who serves as vice president of GE Plastics' resin business, will become president and chief executive of the new business, which Saudi Basic Industries will rename.