GE Confirms Plans To Shed Majap Unit
by Alan Wolf -- TWICE, 5/16/2008
Louisville, Ky. - GE confirmed this morning that it is exploring strategic alternatives for its major appliance business.
The conglomerate said it is currently considering three options, including a partnership or joint venture, a spin-off, or the outright sale of the business.
“GE Appliances has a very strong brand, great distribution, a talented leadership team and for more than 100 years, has been one of the icons associated with GE in the United States,” GE chairman and CEO Jeff Immelt said in a statement. “However, it remains primarily a U.S. business, meaning its fortunes are tied to the rise and fall of a single market. We want to make this good business great again by finding the right strategic solution – a solution that will give [GE] Appliances the global reach and investment required to compete more effectively."
Immelt said Jim Campbell, president/CEO of the consumer and industrial division that includes white goods, will remain with the majap unit along with its senior management team. GE will retain the division’s lighting and electrical distribution businesses.
Immelt added the decision to move out majaps is “consistent with the strategy we have been executing to transform our portfolio for long-term growth. Since 2003 we have exited slower growth and more volatile businesses, generating $52 billion in gross proceeds from dispositions. These proceeds have been reinvested into a transformed portfolio of faster growth, higher margin businesses, stock buybacks and other restructuring activities. "
GE Appliances, based here, generates $7.2 billion in annual revenues and employs about 13,000 people worldwide.
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