General Electric Co’s plan to spin off energy units into a standalone company could attract investors looking for a well-known name in renewables if they can overlook legacy fossil-fuel operations, financial experts said.
General Electric Co. said it would split into three public companies, focused on energy, healthcare and aviation.
Combining GE Renewable Energy, GE Power, and GE Digital into one business, positioned to lead the energy transition. GE intends to execute tax-free spin-offs of the Renewable Energy and Power company in early 2024. The power unit will mix current wind and gas-fired energy generators and providers, and software program companies, GE stated.
As independently run companies, the businesses will be better positioned to deliver long-term growth and create value for customers, investors, and employees, it added.
GE Chairman and CEO H. Lawrence Culp, Jr. said, “At GE we have always taken immense pride in our purpose of building a world that works. The world demands—and deserves—we bring our best to solve the biggest challenges in flight, healthcare, and energy. By creating three industry-leading, global public companies, each can benefit from greater focus, tailored capital allocation, and strategic flexibility to drive long-term growth and value for customers, investors, and employees. We are putting our technology expertise, leadership, and global reach to work to better serve our customers.”
The energy business would encompass equipment and services for gas, coal and wind turbines, hydro, nuclear and electric power generation. And it would include renewables and digital software operations. Scott Strazik will be the CEO of the combined Renewable Energy, Power, and Digital business, said the company statement.