General Electric, the industrial conglomerate founded by Thomas Edison in 1892, plans to form three global public companies focused on energy, aviation and healthcare in an effort to trim down and pay off debt.
GE plans to spin off the healthcare unit in early 2023 and the energy unit in early 2024, the company said in a news release.
The new energy sector will combine GE Renewable Energy, GE Power, and GE Digital into one business, positioning itself to lead the energy transition, and then pursuing a tax-free spin-off of this business in 2024. Following these transitions, GE will be an aviation-focused company shaping the future of flight, the company added.
As independently run companies, the businesses will be better positioned to deliver long-term growth and create value for customers, investors, and employees, the release stated.
“At GE we have always taken immense pride in our purpose of building a world that works," said GE Chairman and CEO H. Lawrence Culp, Jr. "The world demands—and deserves—we bring our best to solve the biggest challenges in flight, healthcare, and energy."
By creating three industry-leading, global public companies, Culp said that each can benefit from greater focus, tailored capital allocation, and strategic flexibility to drive long-term growth and value for customers, investors, and employees.
“Today is a defining moment for GE, and we are ready," said Culp. "Our teams have done exceptional work strengthening our financial position and operating performance, all while deepening our culture of continuous improvement and lean. And we’re not finished—we remain focused on continuing to reduce debt, improve our operational performance, and strategically deploy capital to drive sustainable, profitable growth. We have a responsibility to move with speed to shape the future of flight, deliver precision health, and lead the energy transition. The momentum we have built puts us in a position of strength to take this exciting next step in GE’s transformation and realize the full potential of each of our businesses.”
