Diversified Operations Industry Outlook Bleak on Coronavirus Woes

J.P. Morgan’s Stephen Tusa peered into the books of CFM International—General Electric’s joint venture with jet-engine partner Safran—and found more reason to take issue with Wall Street analysts who are bullish on GE stock.

General Electric is selling its iconic lighting unit to smart home company Savant Systems as GE focuses on its industrial offerings.

General Electric is selling the unit to Savant Systems, a smart-home company, for an undisclosed amount.

GE Healthcare today announced U.S. FDA 510(k) clearance of AIR Recon DL. This pioneering technology, using a deep learning-based neural network, improves the patient experience through shorter scan times while also increasing diagnostic confidence with better image quality across all anatomies. AIR Recon DL, developed on GE Healthcare’s Edison intelligence platform, seamlessly integrates into the clinical workflow to generate AIR Recon DL images in real-time at the operator’s console.

Shares of General Electric Co. jumped 6.5% in morning trading Wednesday, after the industrial conglomerate announced a deal to sell its nearly 130-year old GE Lighting business to privately held home control and automation company Savant Systems Inc. The Wall Street Journal reported that the deal was valued at around $250 million. The deal, which is expected to close in mid-2020, includes a long-term licensing deal for Savant to use the GE brand. GE Lighting will remain headquartered in Ohio, and its more than 700 employees will transfer to Massachusetts-based Savant after the deal closes. "Today's transaction is another important step in the transformation of GE into a more focused industrial company," said GE Chief Executive Larry Culp. "Together with Savant, GE Lighting will continue its legacy of innovation, while we at GE will continue to advance the infrastructure technologies that are core to our company and draw on the roots of our founder, Thomas Edison." GE's stock has run up 31.9% since closing at a 29-year low on May 15 through Tuesday, but has still lost 35.1% year to date, while the Dow Jones Industrial Average has declined 11.6% this year.

(Bloomberg) -- General Electric Co. cut one of the last remaining links to founder Thomas Edison, as the beleaguered manufacturer wrapped up a three-year process to sell its iconic lightbulb business.Automation-products company Savant Systems Inc. will acquire GE’s consumer operations, including lighting and smart-home goods, and bring on the business’s more than 700 employees, the companies said Wednesday in a statement. They didn’t disclose terms of the deal, which is expected to close later this year.While lighting has become a minor part of GE’s operations, the sale is symbolic for a company that has shed elements of its past as it grappled with dwindling cash and slowing demand. GE in recent years sold its century-old locomotive unit and backed away from some health-care and oil businesses.The lighting unit’s sale is an “important step in the transformation of GE into a more focused industrial company,“ Chief Executive Officer Larry Culp said in the statement.GE will now effectively cease to be a consumer-facing company, focusing primarily on making jet engines and power-generation equipment. The Boston-based manufacturer sold its home-appliances operations in 2016, though the “GE Appliances“ brand name remains in use. Savant also will gain a “long-term licensing agreement“ to use the GE brand.The shares climbed 6.7% to $7.24 at 9:49 a.m. in New York. GE had dropped 39% this year through Tuesday, while the S&P 500 slid 7.4%Lighting IdentityLightbulbs have been central to GE’s identity since its founding. The business traces its roots to 1879, when Edison created the first practical commercial incandescent lamp. His interests around lights and related technologies served as precursors to GE, which was formed in 1892.The company struggled in recent years to adapt to a market upended by government efforts to phase out traditional bulbs in favor of energy-efficient options such as light-emitting diode technology. GE pointed to regulations when it decided in 2010 to close a Winchester, Virginia, factory that was its last U.S. plant making tungsten-filament incandescent bulbs.Read more: GE’s Viral Gaffe: To Reset Smart Bulb, Turn Off, On, Off, On...Then-CEO Jeffrey Immelt had considered selling GE’s appliances and lighting units more than a decade ago but halted the plans because of the financial crisis. In 2015, he separated certain energy-related operations, including commercial LEDs, into a new division called Current, while leaving GE Lighting focused on consumer bulbs and connected-home products.GE officially put the lighting business on the market in mid-2017, and dismantled the operations piecemeal over the following years. It sold some overseas and automotive lighting operations in early 2018 and reached a deal later that year to unload Current.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

Thomas Edison's company is selling off the product the inventor is best known for. General Electric (NYSE: GE) said Wednesday it has a deal in place to sell its consumer lighting business to Savant Systems, part of a broader restructuring of the industrial conglomerate. Shares of GE have lost 70% of their value compared to its 1990s heydays, but the conglomerate is attempting to raise cash to pay down the debt by shedding units including its locomotive business, part of its healthcare unit, and lighting.

General Electric Co. (GE) said it reached an agreement to sell its unit GE Lighting to smarthome company Savant Systems Inc. for an undisclosed sum.Shares in GE rose 8% to $7.35 in U.S. midday trading. The deal, which includes a long-term licensing agreement for the use of the GE brand, is still subject to customary closing conditions and is expected to close mid-2020.“Today’s transaction is another important step in the transformation of GE into a more focused industrial company,” said GE Chairman and CEO H. Lawrence Culp. “Together with Savant, GE Lighting will continue its legacy of innovation, while we at GE will continue to advance the infrastructure technologies that are core to our company and draw on the roots of our founder, Thomas Edison.”GE Lighting has a history of almost 130 years from the dawn of incandescent bulbs to industry-first LED and smart solutions along with the world’s first voice-embedded lighting product. Today, GE Lighting’s portfolio includes home lighting and smart home solutions. Following the closure of the transaction, GE Lighting will remain headquartered in Cleveland, Ohio, and its more than 700 employees will be transferred to Savant.Shares in GE have been hit hard this year, dropping almost 40%. The sharp decline is mostly on account of GE’s heavy dependency on the commercial aviation sector, which has come to an almost standstill during the coronavirus pandemic. GE announced this month that it is cutting 25% of the workforce at its aviation unit, which makes engines for Boeing (BA) and Airbus.The job cuts are part of recently announced cost-cutting plans. For the rest of the year, GE expects to reduce operational costs by more than $2 billion and save over $3 billion more in cash preservation measures.Five-star analyst Stephen Tusa at J.P. Morgan, who has a Hold rating on the stock, says that 2020 is likely to be materially negative for FCF at a time when GE is not in a good position to withstand the current crisis.“Yes, COVID-19 is a major factor, but it is for many others and the 1Q was a standout negative,” Tusa wrote in a recent note to investors. “Putting this aside, however, things are set to get materially worse near term, then not get better for a while, with a chance to get even worse as time goes on."Tusa’s $5 price target puts the downside potential in the shares at 32% over the coming year. This compares with an average analyst price target of $8.50 per share.The Street’s rating outlook for General Electric is currently split down the middle, with 7 Buy and 7 Hold ratings, adding up to a Moderate Buy consensus. (See GE stock analysis on TipRanks).Related News: Air Canada’s Proposed Takeover Of Transat Faces EU Anti-Trust Probe Ryanair Cuts Traffic Target By Almost 50% For Coming Year, Seeks To Reduce Boeing Plane Deliveries Boeing Gets No Orders in April, Customers Cancel 737 MAX Jets More recent articles from Smarter Analyst: * Microsoft Seeks $2B Stake In India’s Jio Platforms- Report * Boeing Cuts 6,770 Jobs In U.S.; CFRA Upgrades Stock To Buy   * Google Faces Arizona Lawsuit Over ‘Unfair’ Location Data Storing * Novavax Seeks To Make 1 Billion Covid-19 Vaccine Doses; Top Analyst Ramps Up PT To $61

A vaccine will eliminate the coronavirus, permitting travel, encouraging airplane sales and airplane engine sales, too -- or so the theory goes.

(Bloomberg) -- WeWork’s board is scheduled to vote on appointing two new directors on Friday, a critical step in a clash between shareholder SoftBank Group Corp. and a rival faction at the troubled co-working startup.A lawyer for WeWork told Delaware Chancery Court Judge Andre Bouchard in a letter that the company plans a May 29 meeting to fill two empty independent director seats. The nominees are Alex Dimitrief, General Electric Co.’s ex-top lawyer, and Frederick Arnold, the former chief financial officer for Convergex Group.SoftBank and the rival board faction are feuding over the Japanese conglomerate’s decision to scrap a $3 billion deal to buy stock from WeWork’s ex-Chief Executive Officer Adam Neumann and other shareholders. SoftBank agreed to the purchase last year as it bailed out the struggling startup, but then notified stockholders in March that some of that deal’s conditions hadn’t been met.Two independent WeWork directors then sued SoftBank for not following through on the deal. One of them, Bruce Dunlevie, is a partner at the venture firm Benchmark Capital, which had planned on selling WeWork shares to SoftBank as part of the agreement.The new directors are expected to butt heads with the pair who filed the suit. The incoming directors will be on a special board committee tasked with deciding whether Dunlevie and Lew Frankfort can properly represent the company in the Softbank suit.In a court hearing today, Bouchard rejected Dunlevie and Frankfort’s bids to block WeWork from adding new directors and creating a new board committee. Dunlevie and Frankfort made up the earlier special committee that made the decision to sue.“We believe SoftBank has no basis to question the special committee’s authority to bring this action and we are pleased by the court’s recognition that any effort by SoftBank to challenge that authority must be presented” to Bouchard, a spokesman for Dunlevie and Frankfort said Wednesday.WeWork officials countered they were simply trying to follow the best corporate governance practices by pushing forward with the new board appointees. “The court’s decision today allows that process to go forward,” a Softbank spokesperson said in an emailed statement.In their suit, Dunlevie and Frankfort contend SoftBank reneged on promises to “use its reasonable best efforts to consummate” the stock-purchase agreement because of “buyer’s remorse.”They also noted the agreement doesn’t contain a so-called “material adverse effect” provision or similar termination right that is common in such deals. Two years ago, a Delaware judge found such a provision permitted Germany’s Fresenius SE to walk away from its takeover of U.S. rival generic drugmaker Akorn Inc.In a message to shareholders in March, Softbank cited nearly a half-dozen conditions that WeWork officials hadn’t met as the basis for pulling out of purchase, including its failure to renegotiate some leases in the wake of the economic havoc caused by the Covid-19 pandemic.Neumann – who would have reaped the biggest windfall from the deal – filed his own suit earlier this month claiming SoftBank is relying on legally faulty pretexts to scuttle the deal.The dispute is among several busted-deal cases tied to Covid-19 that landed in Delaware’s business court. The state is the corporate home to more than half of U.S. public companies and more than 60% of Fortune 500 firms. Chancery judges hear cases without juries and can’t award punitive damages.Dunlevie’s and Frankfort’s suit is The We Company v. SoftBank Group Corp, No. 2020-0258, Delaware Chancery Court (Wilmington). Neumann’s case is Neumann v. SoftBank Group Corp, Delaware Chancery Court.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

The Tennessee Department of Treasury, which oversees the state’s pension, sold all its Apple and Amazon stock in the first quarter. It also slashed the investment in Disney and bought up embattled GE stock.

Every stock, these days, feels like a vaccine stock. That’s especially true for the beaten-up commercial aerospace sector.

(Bloomberg Opinion) -- It’s the end of an era at General Electric Co.The industrial giant that evolved out of the invention of the modern lightbulb agreed on Wednesday to finally sell the remaining vestiges of its lighting business to smart-home company Savant Systems Inc. Terms weren’t disclosed, but the Wall Street Journal reported a price tag of $250 million, which seems like a decent valuation for a business that had become such a small part of GE’s overall enterprise.The symbolism is rich. After all, GE traces its roots back to Thomas Edison, the inventor of the modern lightbulb, and just celebrated the 128th anniversary of the founding merger of Edison General Electric Co. with Thomson-Houston Electric Co. The fingerprints of Edison’s legacy will linger: The lightbulb gave way to the X-ray machine, which GE still sells through its health-care unit, and early versions of the light bulb used carbon filaments, a permutation of which are now used in jet-engine parts made by the company’s aviation unit. And yet, selling the light-bulb business marks another historic break with GE’s past, much like the divestiture of its appliances division to China’s Haier Group in 2016 and its hard crash out of the Dow Jones Industrial Average in 2018. Like Haier, Savant has struck a long-term licensing agreement to continue branding the bulbs with the GE name. GE will live on as a household name, but as a shell of its former self. The lighting sale has been a long time coming. And while the nostalgic side of me may feel a little sad to see GE officially drop out of the consumer landscape, it’s a step forward for CEO Larry Culp’s turnaround efforts. GE considered divesting the division that housed the lighting operations amid the financial crisis of 2008; this more recent sales effort goes back to at least 2016. Jeff Immelt was still CEO back then. His successor, John Flannery, also included lighting in the list of assets he would try to sell as he dug GE out of a cash-flow hole caused by challenges in its gas turbine business. But it was Culp who officially inked a deal to sell the commercial part of the lighting operations to private equity firm American Industrial Partners in late 2018, and he’s the one who’s finally found a buyer for the residential lightbulb business. This asset sale isn’t going make or break the company, but every bit helps as the coronavirus pandemic hobbles GE’s crown jewel aviation unit and deepens its cash crunch. It’s downright impressive that Culp was able to get a deal done at all in the middle of a pandemic. That may be a big reason why GE shares were up more than 9% at one point Wednesday morning after the news. There’s no way to sugarcoat the challenges facing the aviation unit right now. While GE’s fleet of engines is younger than many peers and focuses mostly on the narrow-body jets that are likely to come back into service first as air travel starts to slowly pick up again, a wave of retirements for more maintenance-heavy, older models will still hurt and risks creating a glut of spare parts. It remains unclear why GE’s aviation unit fared so much worse in the first quarter than rival engine maker Pratt & Whitney and other aerospace suppliers. But the lighting sale is a sign that Culp isn’t giving up on turning GE around and adapting the company to its current reality. This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Brooke Sutherland is a Bloomberg Opinion columnist covering deals and industrial companies. She previously wrote an M&A column for Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

Massachusetts-based smart home company Savant Systems this morning announced a deal to acquire GE Lighting. The division has existed as part of General Electric since 1911, with its origins reaching back even further to Thomas Edison’s work in the space. Today’s GE Lighting portfolio still largely revolves around bulbs, with some push into more modern corners of the category, including LEDs.

(GE) the iconic American manufacturer founded by Thomas Edison, is cutting ties with his most famous invention: the lightbulb. The company announced Wednesday it was selling GE Lighting to Savant Systems. “Together with Savant, GE Lighting will continue its legacy of innovation, while we at GE will continue to advance the infrastructure technologies that are core to our company and draw on the roots of our founder, Thomas Edison.”

The death toll from Friday's passenger aircraft crash in Pakistan's southern city of Karachi has been confirmed at 97 with two survivors, while no fatalities were reported from the dense residential neighbourhood where the aircraft crash-landed, authorities said on Saturday. Pakistan International Airlines flight PK 8303, an Airbus A320, was flying from Lahore to Karachi with 99 people on board when it went down at about 2:45 p.m. (0945 GMT) while trying a second landing attempt. "Final plane crash update: 66 bodies were brought to (Jinnah Postgraduate Medical Centre), 31 bodies were brought to Civil Hospital Karachi," the provincial health minister's media coordinator said in a communique, adding that there were no deaths confirmed on the ground.

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The conglomerate's turnaround effort took another (small) step forward with the sale of an iconic division.