GE Capital seeks buyer for finance division - Trade Only Today

GE Capital seeks buyer for finance division

The marine industry’s major wholesale lender announced that it will sell its business to simplify operations.
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The marine industry’s major wholesale lender announced that it will sell its business to simplify operations.

Lending behemoth GE Capital said Friday that its Commercial Distribution Finance business is being targeted for sale.

General Electric is hoping to reduce the size of GE Capital with the sale of most of its assets so it can focus on investment and growth in its industrial and manufacturing businesses, spokesman Jake Daubenspeck told Trade Only Today in an email on Saturday.

Although GE Capital Commercial Distribution Finance is among the businesses targeted for disposition, “we’re fully committed to serving our customers and we continue to value our long-standing customer relationships,” Daubenspeck said.

“This business is a market-leading franchise with talented professionals and valuable customer relationship,” he added. “We anticipate being able to sell our businesses to buyers who are fully committed to and invested in the financial services industry and can offer a good environment for growth.”

GE’s board decided it will sell most of GE Capital’s assets during the next 24 months because “this is a great market for selling financial assets,” GE Capital chairman and CEO Keith Sherin said in a statement released Friday afternoon.

It will continue to focus on the Industrial Internet, technology and advanced manufacturing,

“These businesses are leaders in technology, the Industrial Internet and advanced manufacturing,” Sherin said. “They are well positioned in growth markets and are delivering superior customer outcomes while achieving higher margins. They will be paired with a smaller GE Capital, whose businesses are aligned with GE’s industrial growth.”

To that end, GE announced an agreement Friday to sell the bulk of the assets of GE Capital Real Estate to funds managed by Blackstone. Wells Fargo will acquire a portion of the performing loans at closing. The company also has letters of intent with other buyers for an additional $4 billion of commercial real estate assets. In total, the transactions are valued at about $26.5 billion.

Under the plan, GE expects that by 2018 more than 90 percent of its earnings will be generated by its high-return industrial businesses, up from 58 percent in 2014.

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