General Electric banners hang on the facade of the New York Stock Exchange on Tuesday, April 2, 2024 in New York. General Electric has completed its split of the one-time conglomerate into three separate companies, as its aerospace and energy businesses prepare to start trading on the New York Stock Exchange as separate entities. (AP Photo/Peter Morgan)
By Michelle Chapman, AP writer
General Electric, long a symbol of American manufacturing and steeped in a rich history, is officially moving on from its existence as a sprawling conglomerate.
The Boston company, known for everything from light bulbs to jet engines, has completed its split into three separate companies, as its aerospace and energy businesses start trading on the New York Stock Exchange as separate entities on Tuesday.
GE announced in November 2021 that it planned to split into three companies focused on aviation, energy, and health care. At the time the company had already rid itself of the appliances that it was known for. In 2020 GE stopped sales of the light bulbs that it had been making since its founding in the late 19th century.
In its heyday, GE’s stock became one of the most sought after on Wall Street under Jack Welch, one of America’s first CEO “superstars.” Nicknamed “the house that Jack built,” GE routinely outperformed peers and the broader market, helped in part by GE Capital, its financial wing. Through the 1990s, it returned 1,120.6% on investments. GE’s revenue grew nearly fivefold during the tenure of Welch — who was named chief executive in 1981 — and the company’s value increased 30-fold.
Yet the stock began to lag in the summer of 2001, the waning days of Welch’s rule.
The split of GE is the culmination of years of paring by the massive conglomerate which signaled a shift away from a corporate structure that dominated U.S. business for decades.
In a letter to shareholders in February, CEO Larry Culp touched upon GE’s history, recalling how in the first ever letter to shareholders that CEO Charles Coffin “wrote that the creation of the General Electric Company was ‘largely because of the zeal and hearty co-operation’ of our employees.”
With the split of its companies complete, Culp said it was not an end, but rather a beginning for GE.
“Belief in a better way has propelled this company forward since our earliest days,” he wrote.
The name of the aviation business that is essentially the remaining core of GE, headed by CEO Larry Culp, is GE Aerospace. It makes jet and turboprop engines and retains the “GE” ticker.
With an installed base of approximately 44,000 commercial engines and approximately 26,000 military and defense engines globally, GE Aerospace posted adjusted revenue of about $32 billion last year. It anticipates approximately $10 billion in operating profit by 2028.
The energy wing, including GE Renewable Energy, GE Power, GE Digital, and GE Energy Financial Services, is called GE Vernova. It trades on the NYSE under the “GEV” ticker symbol. GE Vernova has an installed base of more than 7,000 gas turbines and approximately 55,000 wind turbines. The company says that it helps generate about 30% of the world’s electricity.
The healthcare business, called GE Healthcare, supplies diagnostic scanners, imaging patents, and software. It began trading on the Nasdaq under the “GEHC” ticker symbol in January 2023.
“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 in a statement.
In midday trading, GE Aerospace shares added 2.8%, GE Vernova were up about 3.9% and GE Healthcare shed about 0.7%.
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