General Electric Co. altered the terms of the deal to unload its locomotive business, allowing new Chief Executive Officer Larry Culp to boost cash and accelerate an overhaul of the beleaguered manufacturer.

As part of the agreement to merge the transportation unit with Wabtec Corp., GE will take a 24.9 percent stake in the company, up from a previous expectation of 9.9 percent, the companies said Jan. 25 in a statement. GE expects in turn to sell that holding. The deal is now expected to close by the end of February, earlier than the previous goal of the end...