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General Electric to split into three public companies

General Electric Co. said it will split into three public companies, breaking apart the more than century-old company that was once a symbol of American manufacturing might and has struggled in recent years.

The plan is being unveiled three years after Larry Culp took over the troubled company and tried to stabilize its operations by selling off business units and paying down the company’s debt load. But GE’s stock price, despite a 1-for-8 reverse split, has lagged behind the S&P 500 and rivals.

The move is the culmination of a yearslong process of shrinking the company. GE has already sold off its locomotive and home appliances business. It spun off its oil and gas business operations. It has also sold most of its once massive financial services arm, which hobbled the company after the 2008 financial crisis.

What remains today are three businesses—aviation, healthcare and power. The company will now spin them off into separate publicly traded companies.

GE said it is spinning off GE Healthcare, which makes MRIs and other hospital equipment, in early 2023, with GE expecting to retain a stake of 19.9%. In 2020, the unit had about $17 billion in revenue.

It plans to combine its power unit and renewable energy unit, which make turbines for power plants and wind farms, respectively, and spin off that operation in early 2024. Those units together had about $33 billion in revenue in 2020.

That would leave behind a GE focused on making jet engines. The unit, a key supplier to Boeing Co., has been hard hit by the pandemic and had about $22 billion revenue in 2020.

GE shares rose 8.8% in premarket trading.

 

This story has been published from a wire agency feed without modifications to the text

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