GE seeks spinoff of key businesses

General Electric Co. announced Thursday that it wanted to spin off its iconic lighting and appliance businesses, the latest aggressive move by one of the world’s largest companies to reshape its portfolio to focus on faster-growth businesses.

The consumer and industrial businesses have 50,000 of GE’s 300,000 employees, sales of $13.3 billion and a profit of slightly more than $1 billion last year.

Fairfield-based GE announced in May that it planned to sell or spin off its appliance business but now says it is looking to spin off the entire unit, which includes such household appliances as dishwashers and clothes dryers, as well as lighting, motors and electrical distribution.

GE, an industrial, financial services and media conglomerate, said it continued to explore all options for the consumer and industrial operations but believes it makes the most sense to spin off the entire unit to existing shareholders, keeping its leadership teams and employees intact. The company hopes to complete the move next year.

“As we explored our options for appliances, it became clear that the fastest, most efficient step we could take in completing the transformation of our industrial portfolio would be to focus on a possible spinoff of the entire unit,” GE Chairman and Chief Executive Jeff Immelt said in a statement.

“This is consistent with the strategy we have been executing to transform the GE portfolio for long-term growth and makes sense for GE shareholders,” he said.

Immelt has made clear that GE’s NBC network is not for sale, despite some analysts calls for such a move. The spinoff would create a separate publicly traded company owned by GE shareholders.

“While the deal does not unlock value per se, it is a step toward improving the portfolio,” Citigroup analyst Jeffrey Srague wrote in a research note.

The announcement was not a surprise and stems from GE’s poor earnings in the first quarter, said Deane Dray of Goldman Sachs Group Inc. A spinoff avoids taxes associated with selling the appliance business, he said.

“We also believe GE could still pursue a sale of the stand-alone appliances, with today’s announcement potentially creating a sense of urgency among potential bidders for this legacy consumer asset,” Dray wrote in his report.

Shares of GE shares rose 45 cents Thursday to $27.64.