Trian Comments on GE Framework
March 22 2017 - 8:38AM
Business Wire
Trian Fund Management, L.P., one of the largest stockholders of
General Electric Company (NYSE:GE), with beneficial ownership of
approximately 66.8 million shares, issued the following statement
regarding its recent discussions with GE as detailed in the
company’s Form 8-K filed today:
“Trian invested in GE in 2015 because we liked its industrial
businesses, appreciated the initiative to separate GE Capital, and
believed management would meet its public commitment to
shareholders to earn $2.00 per share in 2018. Over the past month,
Trian has intensified its dialogue with senior management regarding
new initiatives to help ensure that GE can meet its financial
commitments. We are pleased with the new framework that GE
announced today.
Trian believes GE’s commitment to reduce Industrial structural
costs1 ratably over the next two years from $24.9 billion in 2016
to $22.9 billion in 2018 will help to improve long-term operating
performance by further simplifying and streamlining the
organization and is critical to ensuring that the company achieves
its financial goals. We also believe that the 2017 Industrial
operating profit target announced today is important because it
requires management to achieve its EPS targets in a high quality
manner (i.e. via Industrial operating profit growth). Furthermore,
we believe that the changes to the executive management team’s
existing compensation packages along with the company’s commitment
to review its framework for 2018 compensation (with a goal to align
incentives around the financial metrics that most directly impact
the creation of long-term shareholder value) is positive for
shareholders. At this critical juncture, Trian believes that
today’s announcements better position GE for the long-term and help
to ensure GE will achieve its financial goals. We will continue to
hold management accountable to its commitments.”
About Trian Fund Management, L.P.
Founded in 2005 by Nelson Peltz, Ed Garden and Peter May, Trian
Fund Management, L.P. is a highly engaged shareowner that
seeks to invest in high quality but undervalued and underperforming
public companies and to work collaboratively with management
teams and boards of those companies to execute operational
and strategic initiatives designed to drive long-term
sustainable earnings growth for the benefit of all
stakeholders.
DISCLAIMERS
The views expressed in this press release represent the opinions
of Trian Fund Management, L.P. (“Trian”) and certain of the funds
and investment vehicles it manages (collectively, “Trian Partners”)
as of the date hereof and are subject to change without notice.
Such views and opinions are based on publicly available information
as of the date hereof with respect to General Electric Company (the
"Issuer"). Trian recognizes that there may be confidential
information in the possession of the Issuer that leads the Issuer
to disagree with Trian’s conclusions.
Certain financial information and figures referenced in this
press release have been derived or obtained from filings made with
the Securities and Exchange Commission (“SEC”) or other regulatory
authorities and from other third party reports. Neither Trian
Partners nor any of its affiliates shall be responsible or have any
liability for any misinformation contained in any third party, SEC
or other regulatory filing or third party report. There is no
assurance or guarantee with respect to the prices at which any
securities of the Issuer will trade, and there can be no
assurance or guarantee of the impact of any strategies or operating
initiatives suggested by Trian on the actual results or performance
of the Issuer. Trian reserves the right to change any of its
opinions expressed herein at any time as it deems appropriate.
Trian disclaims any obligation to update the data, information or
opinions contained herein.
This press release is provided merely as information and is not
intended to be, nor should it be construed as, an offer to sell or
a solicitation of an offer to buy any security. The information
provided in this press release is not intended as investment advice
or a recommendation to buy or sell any type of investment, or as an
opinion on, or a suggestion of, the merits of any particular
investment strategy. Funds and accounts managed by Trian currently
have a significant interest in shares of the Issuer. These funds
and accounts are in the business of trading—buying and
selling—securities, and they intend to continue trading in
securities of the Issuer. You should assume that one or more of
such funds or accounts will from time to time sell all or a portion
of their holdings (in open market or privately negotiated
transactions or otherwise), buy additional shares or economic
interests in such shares (in open market or privately negotiated
transactions or otherwise), engage in hedging or similar
transactions with respect to such shares or trade in options, puts,
calls, swaps or other derivative instruments relating to such
shares, regardless of the views expressed in this press
release. Consequently, Trian Partners’ beneficial and/or
economic ownership of Issuer’s common stock is expected to vary
over time depending on various factors, with or without regard to
Trian’s views of the Issuer’s business, prospects or valuation
(including the market price of the Issuer’s common stock),
including without limitation, other investment opportunities
available to Trian, concentration of positions in the portfolios
managed by Trian, conditions in the securities markets and general
economic and industry conditions. Trian also reserves the right to
take any actions with respect to investments in the Issuer as it
may deem appropriate, including, but not limited to, communicating
with management of the Issuer, the Board of Directors of the
Issuer, other investors and stockholders, stakeholders, industry
participants, and/or interested or relevant parties about the
Issuer or seeking representation on the Board of Directors of the
Issuer, and to change its intentions with respect to investments in
the Issuer at any time.
This press release contains forward-looking statements. All
statements contained in this press release that are not clearly
historical in nature or that necessarily depend on future events
are forward-looking, and the words “anticipate,” “believe,”
“expect,” “potential,” “opportunity,” “estimate,” “plan,” and
similar expressions are generally intended to identify
forward-looking statements. The projected results and statements
contained in this press release that are not historical facts are
based on current expectations, speak only as of the date of this
press release and involve risks, uncertainties and other factors
that may cause actual results, performance or achievements to be
materially different from any future results, performance or
achievements expressed or implied by such projected results and
statements. Assumptions relating to the foregoing involve judgments
with respect to, among other things, future economic, competitive
and market conditions and future business decisions, all of which
are difficult or impossible to predict accurately and many of which
are beyond the control of Trian. Although Trian believes that the
assumptions underlying the projected results or forward-looking
statements are reasonable, any of the assumptions could be
inaccurate and, therefore, there can be no assurance that the
projected results or forward-looking statements included in this
press release will prove to be accurate. In light of the
significant uncertainties inherent in the projected results and
forward-looking statements included in this press release, the
inclusion of such information should not be regarded as a
representation as to future results or that the objectives and
initiatives expressed or implied by such projected results and
forward-looking statements will be achieved. Trian will not
undertake and specifically declines any obligation to disclose the
results of any revisions that may be made to any projected results
or forward-looking statements in this press release to reflect
events or circumstances after the date of such projected results or
statements or to reflect the occurrence of
anticipated or unanticipated events.
1 Per GE’s 3/22/17 8-K, Industrial structural costs include
segment structural costs excluding the impact of business
acquisitions and dispositions, plus total Corporate operating
profit excluding non-operating pension costs, restructuring and
other charges and gains.
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version on businesswire.com: http://www.businesswire.com/news/home/20170322005637/en/
Trian Media/Investor Contact:Anne
Tarbell212-451-3030atarbell@trianpartners.com
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