Kevin McCoy, and Kaja Whitehouse

USA TODAY

Facing the potential for higher taxes at home and lured by universities and a high-tech future, iconic manufacturing giant General Electric (GE) is moving its headquarters from a Connecticut suburb to Boston, the company announced Wednesday.

GE said the company tapped Boston as the winner from among 40 potential sites reviewed in a formal process that began in June, the culmination of more than three-year consideration of the composition and location of its headquarters.

GE has been well known to generations of Americans for its its consumer and kitchen appliances, home and electrical products, as well as parts and accessories.

Boston won the relocation nod based on an evaluation of its business ecosystem, talent, long-term costs, quality of life for employees, wealth of higher education centers and other factors, GE said.

GE said the move would have "no material financial impact" on the company. Massachusetts and Boston officials structured a package of incentives that provide benefits to the state and city, while also "helping offset" GE's relocation costs, the company said.

Additionally, GE plans to sell its offices at its longtime headquarters in Fairfield, Conn., and at 30 Rockefeller Plaza in New York City to further offset the relocation cost.

"GE aspires to be the most competitive company in the world," GE Chairman and CEO Jeffrey Immelt said in a statement announcing the relocation. "Today GE is a $130 billion high-tech global industrial company, one that is leading the digital transformation of industry. We want to be at the enter of an ecosystem that shares our aspirations."

Boston and its surrounding communities represents a good fit because the area is home to 55 colleges and universities and Massachusetts "spends more on research and development than any other region in the world," said Immelt.

GE will have approximately 800 employees in Boston, including 200 corporate staffers and 600 digital industrial product managers, designers and developers, the company said.

The new headquarters will be located in Boston's Seaport District. GE employees will move to a temporary Boston location starting this summer, with a full move completed in several stages by 2018, the company said.

The Fortune 500 company and Dow component has long been based in Fairfield County, a Connecticut suburb within commuting range of New York City. However, GE tentatively scouted new headquarters sites amid the possibility of higher state and local taxes on Connecticut businesses and high-income earners.

Immelt signaled plans to find a new headquarters in June, when he told employees in an email that the company was considering relocating to a state with “a more pro-business environment,” according to media reports at the time. The email followed Connecticut legislature approval of a budget that drew objections from GE.

New York, Providence, R.I. and other cities had been in the running as potential corporate suitors for GE's headquarters.

Massachusetts Gov. Charlie Baker and Boston Mayor Martin Walsh celebrated the company's decision, which they said would bring high-paying jobs to Boston and help the city and Commonwealth achieve further economic growth.

Massachusetts offered GE up to $120 million in incentives through grants and other programs, and Boston offered up to $25 million in property tax relief, the officials said. Additional incentives include $1 million in grants for workforce training, and up to $5 million for an innovation center to establish connections between GE, the higher education community and innovators from Massachusetts research centers.

Connecticut Gov. Dannel Malloy said in a statement GE's pending departure represents "a clear signal that Connecticut must continue to adapt to a changing business climate" by investing in modern transportation and higher education, the needs of high-tech employers and other changes.

"Businesses care about how states budget, and now is the time to continue our bipartisan efforts to reform our budget, find new ways to pay our pensions, and create a more sustainable and predictable state budget," said Malloy.

Shares of GE closed down 1.4% at $28.24.

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The headquarters shift comes amid GE's strategic pursuit of a return to its manufacturing roots, and as it seeks to rebrand as a tech company.

"We are transforming GE into the world's premier digital industrial company," reads a statement by Immelt on the company's website.

Boston, meanwhile, has positioned itself as a rising hub for tech firms and engineers. GE’s decision “just reinforces what Boston has become, which is an international hub of innovation and imagination and talented people,” said Jim Rooney, of the Greater Boston Chamber of Commerce.

As part of its transformation, GE announced in April that it would sell an estimated $200 billion in assets from its GE Capital financing division. By October, it sold $30 billion in commercial lending and leasing businesses to Wells Fargo (WFC).

The company has also moved on expansion overseas. GE in November completed a $9.5 billion acquisition of energy businesses from French multinational conglomerate Alstom SA. The deal marked a victory for Immelt, 59, a New Canaan, Connecticut resident who convinced a range of government and business regulators to approve the transaction.

GE plans to cut 6,500 Europe-based jobs from businesses acquired in the Alstom deal, a Paris-based company spokesman told several medial outlets Wednesday. However, GE remains committed to adding 1,000 jobs to its employment force in France during the first three years after the Alstom acquisition, The Wall Street Journal reported.

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