The Boston-based industrial conglomerate also said it’s planning an “orderly separation” from its 62.5% stake in BHGE oil and gas servicing and equipment unit over the next two to three years.
Little Chalfont, U.K.-based GE Healthcare has long been a bright spot for its parent, consistently posting sales and profit gains despite overall declines at GE. In April division agreed to sell its value-based healthcare division to Veritas Capital for $1.05 billion in cash; that deal is expected to close during the third quarter.
Today General Electric CEO John Flannery – formerly head of the healthcare unit – said GE Healthcare chief Kieran Murphy will stay on to the lead the $19 billion company after its emancipation.
“GE Healthcare’s vision is to drive more individualized, precise and effective patient outcomes. As an independent global healthcare business, we will have greater flexibility to pursue future growth opportunities, react quickly to changes in the industry and invest in innovation. We will build on strong customer demand for integrated precision health solutions and great technology with digital and analytics capabilities as we enter our next chapter,” Murphy said in prepared remarks.
“GE Healthcare is an industry leader with financial strength, global scale and cutting-edge technology. Our talented healthcare team will continue delivering precision health solutions, building on our heritage of technology innovation that delivers patient outcomes,” Flannery added.
The plan calls for the sale of a 20% stake in the business, with the balance to be transferred to GE shareholders in a tax-free distribution, the company said. The spinout is slated to be complete over the next year to 18 months, with the exact structure, sequence and timing to be determined.
“Today marks an important milestone in GE’s history. We are aggressively driving forward as an aviation, power and renewable energy company – three highly complementary businesses poised for future growth. We will continue to improve our operations and balance sheet as we make GE simpler and stronger,” Flannery said.