Nov. 18 (Bloomberg) -- General Electric Co., the world's biggest company by market value, raised its earnings forecast and increased a share-buyback program to $25 billion following the sale of its reinsurance business to Swiss Reinsurance Co.

Earnings from continuing operations are likely to be $1.92 to $2.02 a share in 2006, representing growth of 12 to 17 percent, the Fairfield, Connecticut-based company said in a statement today. Previous guidance was for a 10 to 15 percent gain in net income.

The sale of the insurance business for $6.8 billion marks the next phase in Chief Executive Jeffrey Immelt's plan to reinvigorate GE and return profit growth to at least 10 percent annually, a pace achieved in the last five years under Jack Welch, who retired in 2001. Immelt has spent more than $60 billion moving into faster-growing businesses such as healthcare while disposing of more than $25 billion in capital-intensive areas like insurance, excluding today's sale.

Shares of General Electric have dropped about 13 percent since Immelt took over compared with a 14 percent gain in the benchmark Standard & Poor's 500 Index. They rose 12 cents to $34.66 in New York Stock Exchange composite trading yesterday.

GE increased a share buyback plan to $25 billion through 2008, from $15 billion through 2007. It plans to repurchase more than $4 billion of stock this year, as much as $9 billion next year and as much as $8 billion in 2007 and 2008.

The company said it will increase its quarterly dividend by 3 cents to 25 cents a share, giving a full-year payment of $1 a share for next year, up from the current 88 cents.

Prior to the disposal of GE Insurance Solutions, General Electric was on track to post a profit of $1.81 to $1.83 a share for this year, today's statement said. That figure will now be cut to $1.72, it said.

Swiss Reinsurance Co., the world's second-largest reinsurer, will pay $6.8 billion in cash and stock in the company's biggest-ever acquisition. It will also assume $1.7 billion in debt. General Electric will own more than 10 percent of Swiss Re's shares after the sale.

The disposal will reduce GE's reliance on finance activities that currently contribute about its sales and profit. Immelt in July 2002 broke up GE Capital into four areas and stripped a layer of management to have more direct control. Investors often value finance operations less than industrial ones.

On Nov. 2, GE said it expected $1.2 billion in savings next year through the reorganization, four times its initial estimate. The savings will help profit as the company targets 8 percent growth in ``organic'' sales, or revenue excluding acquisitions and insurance.

General Electric is targeting as much as $50 billion in revenue from developing markets in 2014, up from $10 billion this year. Immelt in March said he expects about 60 percent of sales growth to come from outside the U.S. in the next decade. The company had revenue of $152.9 billion last year.

General Electric is the world's biggest provider of power- plant turbines, locomotives, jet engines, aircraft leasing, private-label credit cards and medical-imaging equipment. Other businesses include oil and gas servicing, plastics, appliances, real estate and lighting.

This is cache, read story here