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General Motors has agreed to sell its commercial and military vehicle transmissions business Allison Transmission to a consortium of private equity groups for $5.6 billion.

Allison Transmission is headquartered in Indianapolis and has seven manufacturing sites there. The Baltimore plant that makes conventional and hybrid transmissions for GM pickups and SUVs will remain in GM's hands.

The buyer is a consortium of Carlyle Group and Onex Corporation. Carlyle is one of the biggest names in private equity worldwide and Onex has large-scale private equity interests primarily in Canada.

Allison has around 3,400 employees and generates global revenues of $2 billion.