By Michael Rapoport

PricewaterhouseCoopers plans to hire more than 600 employees from General Electric Co.'s tax team as the accounting firm adds global expertise and the industrial conglomerate continues slimming down.

The Big Four auditing firm and the industrial company have agreed to move GE's in-house global tax team over to PwC. Under the agreement, which was announced Thursday, GE's tax employees in 42 countries will move to PwC, where they will provide tax planning, advice, compliance and other tax services to both GE and other PwC tax clients.

PwC will also take over GE's tax technologies as part of the five-year renewable agreement.

The unusual deal isn't an acquisition -- no money is changing hands. PwC expects to benefit from the agreement by enhancing its operations globally. The firm already has 41,000 global tax professionals, so adding the GE workers would increase the total by only about 1.5%.

PwC's tax business had $9.1 billion in revenue in fiscal 2016. The GE unit, known as Global Enterprise Tax Solutions, could in time bring in more than $1 billion in a year in revenue to PwC from GE and other clients, said Mark Mendola, PwC's vice chairman and U.S. managing partner. With tax overhauls happening around the world, and the "great relationships with policy makers" that GE's tax professionals have, "we think it's a great opportunity," he said.

GE, meanwhile, expects to benefit from lowering its fixed costs and simplifying its organization. GE's tax operation is far-ranging -- the company filesmore than 5,500 income tax returns a year in more than 300 jurisdictions world-wide, according to GE's annual report. Shedding the operation is in line with GE's push to simplify and streamline itself -- the company has cut costs and moved to sell most of its GE Capital assets in recent years.

The agreement with PwC allows GE "the flexibility to scale to the requirements of the changing GE portfolio" even as it provides the company continued access to the work of its tax professionals, said Mike Gosk, GE's senior tax counsel. GE is audited by a different accounting firm, KPMG.

PwC and GE have been discussing an alliance for more than a year, Mr. Mendola said. With corporate tax changes in the offing in the U.S. and the pressures on companies globally to cut costs, PwC and GE thought "wouldn't it be cool to do something together?" he said.

The two companies already have ties. Last September, PwC and GE announced an alliance to help industrial clients apply digital technology. Jan Hauser, GE's controller and chief accounting officer, is a former PwC partner.

Write to Michael Rapoport at Michael.Rapoport@wsj.com

(END) Dow Jones Newswires

January 12, 2017 11:43 ET (16:43 GMT)

Copyright (c) 2017 Dow Jones & Company, Inc.