CEO Jeff Immelt continues to refashion General Electric Co. (NYSE: GE) as an industrial conglomerate with less emphasis on its once-booming financial business. In the company’s latest move, GE has agreed to sell its Australian and New Zealand financial services business to a consortium of KKR, Deutsche Bank and Minneapolis-based alternative investment firm Värde Partners for about $6.3 billion.
Last July, GE spun off its North American lending business in Synchrony Financial (NYSE: SYF). That deal raised about $2.8 billion for GE and created a company with a market value of around $19 billion. Since that initial public offering, Synchrony’s stock has gained about 38% and GE’s stock has dropped about 0.3%.
GE’s stagnant share price has been blamed on investors’ concerns that the financial services business is too big and too risky, and that new regulations will raise its costs and reduce its ability to spin off cash for the company’s other businesses.
Last summer’s $17 billion acquisition of the turbine and other manufacturing businesses of France’s Alstom, combined with the casting off of the finance business, is widely viewed as a return to GE’s roots as an industrial giant. The deal, which is expected to close this year, was GE’s largest ever.
GE has also parted with its appliances business in a $3.3 billion sale last fall to Sweden’s Electrolux.
The Australia-New Zealand unit provides credit cards and personal loans from about 100 branch offices in the two countries. GE’s business claims about 3 million customers and about $5.4 billion in assets. GE will retain its commercial finance unit in Australia and New Zealand.