US conglomerate General Electric on Friday announced plans to dismantle its GE Capital financial services arm and focus on industrial businesses, saying that it has reached a deal to sell its real-estate assets for $26.5 billion.
"This is a major step in our strategy to focus GE around its competitive advantages," GE chairman and CEO Jeff Immelt was quoted as saying in a statement.
The objective mapped out by Immelt and his team is to ensure that more than 90 percent of GE's earnings is generated by its industrial businesses, up from 58 percent last year, Efe news agency reported.
As the first step in that process, the Connecticut-based conglomerate announced that it had reached an agreement to sell most of the assets of GE Capital Real Estate to funds managed by Blackstone Group, adding that Wells Fargo & Co. will acquire a portion of the performing loans at closing.
GE also noted that it "has letters of intent with other buyers for an additional $4 billion of commercial real estate assets", adding that "in total these transactions are valued at approximately $26.5 billion".
GE has a market capitalisation of nearly $280 billion, but its share price has not risen above $30 since the 2008-2009 global recession.
The changes announced on Friday were well received by investors, with the Dow component's share price up nearly 8 percent at $27.76 in midday trading.
