According to Bloomberg.com, General Electric, just two months after placing its appliance unit up for sale, said it plans to spin off its entire GE Consumer & Industrial group to shareholders as it struggles to raise a slumping stock price.
Click to enlarge
Bloomberg notes this strategy means “GE may exit more of the most well-known divisions to consumers, including electrical switches and the light-bulb business and also won’t rule out a sale or other options for the group, which had 50,000 employees and $US13.3 billion in sales last year.
GE Consumer & Industrial is “part of a larger group called GE Industrial, one of six major segments that will continue after the spinoff. The others are NBC Universal, GE Money, GE Infrastructure, GE Commercial Finance and GE Healthcare”, says the report.
GE Consumer & Industrial Chief Executive Officer James Campbell said to employees that “we’ve hit a rough patch in terms of the U.S. economy, but we’ll come through this even stronger than before.”
Possible bidders for the appliance unit include Arcelik AS, Turkey’s largest maker of household appliances; Hong Kong-based Haier Electronics Group and South Korea’s LG Electronics and such a sale could fetch $US3 billion to $US8 billion, according the Bloomberg report.
For its part, GE has cut costs, product lines and jobs from all three divisions in the GE Consumer & Industrial segment for years to keep profitability rising. The lighting operations announced last year that another 1,400 positions would be slashed as it shut incandescent plants in favor of manufacturing more efficient, compact fluorescent bulbs overseas, notes the report.