Reshaping the company and focusing on industrial businesses as the main source of its earnings, GE is selling most of its GE Capital assets by 2018. In announcing the plan, GE chairman and CEO Jeff Immelt noted that the company will retain its “vertical” financing businesses, including GE Capital Energy Financial Services, which directly relate to its core industrial businesses.
Immelt expects GE’s industrial businesses will generate approximately 90% of the company’s operating earnings by 2018, compared to the 58% generated last year.
The estimated $90 billion expected earnings on the sale are expected to be returned to shareholders through share buybacks, dividends and an exchange of Synchrony Financial shares. The new plan will also reduce GE’s share count from 10.1 billion to 8-8.5 billion.
Already, GE has sold the bulk of GE Capital Real Estate assets for approximately $26.5 billion. Other assets to be sold include most of the commercial lending and leasing segment, and all consumer platforms, including all US and international banking assets.