GE's break-up signals how far from favour the conglomerate business model has fallen

While one former executive talked of “the end of the GE we knew,” Culp, who has been chief executive since 2018, said the company had simply concluded that letting the health care, aviation and energy businesses fend for themselves with “greater focus, tailored capital allocation and strategic flexibility” was the best way to set them up for the next 100 years.Article content

“There was almost an Elon Musk hype that drove the stock,” recalled Jeffrey Sonnenfeld, a professor at Yale School of Management. The financial crisis of 2007-2009 exposed how much the group depended on GE Capital and how little investors understood about the risks lurking within it. The process of trying to bring GE Capital’s risks under control began under Welch’s successor Jeff Immelt, who began a series of disposals including the US$30-billion sale of a speciality finance portfolio to Wells Fargo in 2015. By then, he had also sold NBCUniversal to Comcast; in 2016 he sold GE’s century-old appliances business too, to China’s Haier.Article content

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General Electric to split into 3 public companiesGeneral Electric, the storied American manufacturer that struggled under its own weight after growing to become a sprawling conglomerate, will divide itself into three public companies focused on aviation, healthcare and energy. My Dad worked for General Electric many years ago. This would have devastated him.
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