- Swift Execution Continues on Strategy
to Divest Most of GE Capital
- New Deals Since April 10 Announcement
Reach $23 Billion Bringing Total Deals Signed to $68 Billion
- On Track to Sell $100 Billion by Year
End and be Largely Complete by End of 2016
GE (NYSE:GE) announced today that Sumitomo Mitsui Banking
Corporation Europe Limited (SMBCE), a wholly owned subsidiary of
Sumitomo Mitsui Banking Corporation (SMBC) has made an agreed offer
to acquire GE’s European Sponsor Finance business for approximately
US$2.2 billion. The business is a leading provider of sponsor
finance for European mid-market, private-equity backed
transactions.
“As GE Capital continues to execute on its strategy to sell most
of the assets of GE Capital, this agreement with SMBCE shows our
European businesses are of great interest to financial services
firms around the world,” said Keith Sherin, GE Capital chairman and
CEO. “We had many indications of interest in this business and are
pleased to partner with SMBCE on the sale of this franchise,” he
added.
GE Capital will retain its $1 billion investment in the European
Senior Secured Loan Programme and European Loan Programme, both
joint ventures between affiliates of GE Capital and affiliates of
Ares Capital.
When completed, the portfolio, which represents about $2.2
billion of ENI, will contribute approximately $0.4 billion of
capital to the overall target of approximately $35 billion of
dividends expected to GE under this plan (subject to regulatory
approval).
The transaction is subject to customary regulatory approval. It
is expected to close in the third quarter of 2015. Bank of America
Merrill Lynch and Citigroup Global Markets provided financial
advice to GE and Clifford Chance provided legal advice.
Update on GE Capital Progress
As previously announced, GE is embarking on a strategy to focus
on its high-value industrial businesses and is selling most GE
Capital assets. GE will retain the financing “verticals” that
relate to GE’s industrial businesses.
Since the April 10 announcement, GE has signed agreements to
sell about $23 billion, including the European Sponsor Finance deal
announced today with ENI of $2.2 billion. Other sales during the
quarter include $1.2 billion of loans in our UK Home Lending
portfolio, plus the previously announced $8.6 billion global Fleet
Services business and the approximately $11 billion U.S. Sponsor
Finance business.
In addition, during the quarter, the sale of GE Capital’s
Budapest Bank to the Hungarian State closed on June 29 and GE
Capital Real Estate closed, in total, approximately $15 billion of
previously announced sales.
Sherin concluded, “We’ve had tremendous interest in our
businesses and assets. We continue to execute with speed, certainty
and value as we work to transform GE to a more focused industrial
company.”
About GE
GE (NYSE:GE) imagines things others don’t, builds things others
can’t and delivers outcomes that make the world work better. GE
brings together the physical and digital worlds in ways no other
company can. In its labs and factories and on the ground with
customers, GE is inventing the next industrial era to move, power,
build and cure the world. www.ge.com.
GE’s Investor Relations website at www.ge.com/investor and our
corporate blog at www.gereports.com, as well as GE’s Facebook page
and Twitter accounts, including @GE_Reports, contain a significant
amount of information about GE, including financial and other
information for investors. GE encourages investors to visit these
websites from time to time, as information is updated and new
information is posted.
Caution Concerning Forward-Looking Statements:
This document contains “forward-looking statements” – that is,
statements related to future, not past, events. In this context,
forward-looking statements often address our expected future
business and financial performance and financial condition, and
often contain words such as “expect,” “anticipate,” “intend,”
“plan,” “believe,” “seek,” “see,” “will,” “would,” or “target.”
Forward-looking statements by their nature address matters that
are, to different degrees, uncertain, such as statements about our
announced plan to reduce the size of our financial services
businesses, including expected cash and non-cash charges associated
with this plan; expected income; earnings per share; revenues;
organic growth; margins; cost structure; restructuring charges;
cash flows; return on capital; capital expenditures, capital
allocation or capital structure; dividends; and the split between
Industrial and GE Capital earnings. For us, particular
uncertainties that could cause our actual results to be materially
different than those expressed in our forward-looking statements
include: obtaining (or the timing of obtaining) any required
regulatory reviews or approvals or any other consents or approvals
associated with our announced plan to reduce the size of our
financial services businesses; our ability to complete incremental
asset sales as part of this plan in a timely manner (or at all) and
at the prices we have assumed; changes in law, economic and
financial conditions, including interest and exchange rate
volatility, commodity and equity prices and the value of financial
assets, including the impact of these conditions on our ability to
sell or the value of incremental assets to be sold as part of this
plan as well as other aspects of this plan; the impact of
conditions in the financial and credit markets on the availability
and cost of GECC’s funding, and GECC’s exposure to counterparties;
the impact of conditions in the housing market and unemployment
rates on the level of commercial and consumer credit defaults;
pending and future mortgage loan repurchase claims and other
litigation claims in connection with WMC, which may affect our
estimates of liability, including possible loss estimates; our
ability to maintain our current credit rating and the impact on our
funding costs and competitive position if we do not do so; the
adequacy of our cash flows and earnings and other conditions which
may affect our ability to pay our quarterly dividend at the planned
level or to repurchase shares at planned levels; GECC’s ability to
pay dividends to GE at the planned level, which may be affected by
GECC’s cash flows and earnings, financial services regulation and
oversight, and other factors; our ability to convert pre-order
commitments/wins into orders; the price we realize on orders since
commitments/wins are stated at list prices; customer actions or
developments such as early aircraft retirements or reduced energy
demand and other factors that may affect the level of demand and
financial performance of the major industries and customers we
serve; the effectiveness of our risk management framework; the
impact of regulation and regulatory, investigative and legal
proceedings and legal compliance risks, including the impact of
financial services regulation and litigation; adverse market
conditions, timing of and ability to obtain required bank
regulatory approvals, or other factors relating to us or Synchrony
Financial that could prevent us from completing the Synchrony
Financial split-off as planned; our capital allocation plans, as
such plans may change including with respect to the timing and size
of share repurchases, acquisitions, joint ventures, dispositions
and other strategic actions; our success in completing, including
obtaining regulatory approvals for, announced transactions, such as
the proposed transactions and alliances with Alstom, Appliances,
Real Estate and Sponsor Finance, and our ability to realize
anticipated earnings and savings; our success in integrating
acquired businesses and operating joint ventures; the impact of
potential information technology or data security breaches; and the
other factors that are described in “Risk Factors” in our Annual
Report on Form 10-K for the year ended December 31, 2014. These or
other uncertainties may cause our actual future results to be
materially different than those expressed in our forward-looking
statements. We do not undertake to update our forward-looking
statements.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20150630005605/en/
Investor:Matt Cribbins,
+1-203-373-2424matthewg.cribbins@ge.comorMedia:GE
Capital:Susan Bishop,
+1-203-750-5362susan.bishop@ge.comorSMBC:Morita Takashi,
+81-3-4333-3809morita_takashi@ay.smbc.co.jporGE:Seth Martin,
+1-203-572-3567seth.martin@ge.com
GE Aerospace (NYSE:GE)
Historical Stock Chart
From Mar 2024 to Apr 2024
GE Aerospace (NYSE:GE)
Historical Stock Chart
From Apr 2023 to Apr 2024