Sweden's Electrolux is near a deal to buy General Electric's iconic appliance business for more than $2.5 billion, people familiar with the matter said. 

Such a move would significantly expand the Swedish firm's reach in North America.

The companies are hammering out final terms of a deal and could announce their agreement as soon as next week, the sources said. But talks are ongoing and could still take longer to finalise, they cautioned. 

Representatives for GE and Electrolux declined to comment. 

GE's century-old household appliance business, which along with lighting generated $8.3 billion in 2013 revenue, could help the Swedish appliance manufacturer expand beyond its core European market where growth has trailed that in North America. 

Electrolux, which sells under brands such as Frigidaire, AEG and Zanussi as well as its own name, is already the world's second-largest home appliance maker after Whirlpool. 

GE had confirmed in August that it was evaluating strategic options for the home appliance business, including discussions with Electrolux and other interested parties. 

With a price tag of more than $2.5 billion, Electrolux appears to be paying top dollar to win the asset. 

The GE business, which sells products under the GE Monogram, GE Cafe and Hotpoint brands, could be worth between $2 billion and $2.5 billion, people familiar with the matter have previously said. 

The US diversified conglomerate has revived efforts to divest the profitable, but low-margin unit as chief executive Jeffrey Immelt seeks to exit businesses where GE is not a global leader and allocate resources to higher-growth businesses. 

GE put the business up for sale in 2008 but talks fizzled out in the face of the global recession. Immelt instead opted to invest $1 billion in new factories and products to make the business more competitive. 

Still, the unit is almost exclusively focused on the US market and lacks global scale, and GE believes it could be more valuable when being part of a global appliances group such as Electrolux, said one person familiar with the divestiture plan. 

After suffering from weak economies and currencies in Europe and Brazil that cost cuts and improvement in the North American market could not offset, Electrolux has seen European demand start to recover this year, but it still lags North America. 

In 2013, western Europe accounted for 28% of group sales while North America represented 32%. 

GE's Immelt is seeking to increase GE’s profit contribution from its industrial manufacturing businesses to 75% by 2016, up from about 55% last year, while reducing exposure to its finance arm. 

Toward that end, GE earlier this year struck a $16.9 billion deal to buy the power assets of France’s Alstom and is exiting its North American consumer finance business.