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The
industrial giant's aerospace and energy businesses will begin
trading on the New York Stock Exchange as separate entities on
Tuesday, more than a year after its healthcare business began
trading on the Nasdaq.
The breakup is a culmination of CEO Larry Culp's efforts to
breathe life into the company that ran into struggles, including
the 2008 financial crisis that nearly bankrupted its most
profitable business, GE Capital.
In late 2021, Culp announced the breakup that had eluded a
generation of insiders after the company had grown vastly in
size as it entered diverse businesses under predecessors.
Such was GE's significance that its finance arm was deemed "too
big to fail" by the U.S. government.
But as it lurched from crisis to crisis, GE, an original member
of the blue chip Dow Jones Industrial Average, lost its place in
the index in June 2018 and Culp, who took over as CEO after a
few months, cut its dividend to a penny to conserve cash.
He started informally discussing the idea of a breakup with
advisors in 2021, Reuters had reported.
Culp, who is now the CEO of GE Aerospace, will ring the NYSE
opening bell on Tuesday, along with Scott Strazik, CEO of energy
business Vernova.
Some Wall Street industrial analysts have been handing over
coverage of GE to their aerospace and energy counterparts and
have reminisced covering a company that emerged after famed
inventor Thomas Alva Edison merged Edison General Electric Co
with a rival to form GE in the late 1800s.
Analysts now estimate the market value of GE Aerospace, which
has been a cash cow for the Boston-based company, at more than
$100 billion after the spinoff.
"With the successful launch of three independent, public
companies now complete – today marks a historic final step in
the multi-year transformation of GE," Culp said on Tuesday.
Last month, GE Aerospace, which makes engines for Boeing and
Airbus jets, forecast operating profit of about $10 billion in
2028 on robust demand for its products and services, and said it
was targeting an initial dividend payout at 30% of net income.
The business will trade on the NYSE under the GE symbol. GE
Vernova will trade under the symbol GEV.
(Reporting by Abhijith Ganapavaram in Bengaluru; Editing by Arun
Koyyur)
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