GE (GE) must be getting low ball offers for the unit.
GE said it continues to explore all options for the consumer and industrial operations, but believes it makes the most sense to spin off the entire unit to existing shareholders, keeping its leadership teams and employees intact. The company hopes to complete the move next year.
“As we explored our options for appliances, it became clear that the fastest, most efficient step we could take in completing the transformation of our industrial portfolio would be to focus on a possible spin-off of the entire unit,” General Electric Co. Chairman and Chief Executive Jeff Immelt said in a statement. “This is consistent with the strategy we have been executing to transform the GE portfolio for long-term growth and makes sense for GE shareholders.”
The spin-off would create a separate publicly traded company owner by GE shareholders.
Immelt is between a rock and a very hard place. He made a promise and failed to deliver. He has shareholders that have been frustrated since the turn of the century. He is “the guy who followed the guy (Jack Welch)”, and that is never a good place to be. In short, he now has to do something very drastic is a market that is very poor for sellers.
This is the best move for him to make now for shareholders but, it is not the move he wanted to make…
Disclosure (“none” means no position):None
Visit the ValuePlays Bookstore for Great Investing Books