Genius is before the fall. Rescued by government loans in the 2008 meltdown, Jeff Immelt is looking to exit the risky operations of GE’s finance arm, before chickens come home…
Real-estate investments and lending aren’t an obvious fit with GE’s better-known businesses of building advanced aircraft engines, power turbines and medical devices. But finance has been a big business for the company under Mr. Immelt, who plowed billions of dollars into property and other investments in search of profits.
The strategy worked until the financial crisis shook the company in 2008 and 2009, forcing it to turn to government-backed lending programs for support and ultimately prompting GE to slash its dividend.
Mr. Immelt has expressed regret about expanding GE Capital going into the crisis. “Clearly in retrospect, you know, I didn’t get that right,” he said… See: GE seeks exit from banking business.
What will GE do with the cash raised on the sale? Why buy back even more of their own shares of course. Here is a direct video link.
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