GE slims down with a $7bn sale to rival Element
GENERAL Electric, the US conglomerate, said yesterday it will sell off GE Capital’s fleet management operations in the US, Mexico, Australia and New Zealand for $6.98bn (£4.44bn) in cash.
GE will sell several of its fleet businesses to a Canadian rival, so that the iconic American brand can focus on its more profitable units.
The fleet businesses provide commercial vehicle financing and fleet management systems, which will be bought by Element Financial, which is listed on the Toronto Stock Exchange.
GE has shown signs of slimming down as it has signed a memorandum of understanding for the potential sale of its European fleet to Arval, a unit of French bank BNP Paribas and Element’s founding partner.
The completion of the transaction with Arval is expected in the fourth quarter of this year, BNP Paribas said.
The Element-Arval Global Alliance, on completing the deals, will be able to manage customer fleets in more than 40 countries, Element said in a statement.
This comes two years after GE had sold its Canadian fleet business to Element in 2013, and against the backdrop of the US conglomerate making steady progress with the sale of $200bn of financial assets.
GE is looking to sell most of its capital assets over the next 18 months as part of a plan to grow its industrial businesses as the principal source of earnings.