GE, the global diversified infrastructure, finance and media giant, is making a strong push to expand its reach in the data center space. The company announced on Thursday an agreement to buy Lineage Power, a maker of power-conversion products for data centers and telecoms.

GE is buying Lineage from The Gores Group, a private equity firm, for about $520m. For the buyer, the move is a way to sell more products of its Energy division into what it sees as a $20bn market for power conversion. Growth in the market is driven by cloud computing and mobile applications.

Dan Heintzelman, GE Energy Services president and CEO, cited recent studies that forecasted 1.1bn smart phones to be sold globally by 2013. "Every new mobile device plugs into an infrastructure that requires an ever-increasing amount of high-quality power," he said.

"The growth in high-bandwidth mobile Internet applications and cloud computing is accelerating that demand. A globally networked planet needs a lot of power to keep spinning. Customers want efficient, reliable means to manage that power.

"As the data-driven economy grows, the addition of Lineage Power's business platform continues the expansion of GE Energy's offerings from the electric grid to data centers, cell towers, routers, servers and circuit board electronics."

Plano, Texas-based Lineage's 2010 revenue was about $450m. The company has about 2,300 employees and operates manufacturing plants in China, Mexico and India.

The deal is expected to close by the end of the current quarter.