A news report initially published in the Wall Street Journal has claimed that a major portion of its digital assets is being planned to be sold by General Electric Co. as a part of its restructuring program.
Citing people with knowledge of the matter, the Journal report stated that for the purpose of auctioning off some parts of its digital business, the services of an investment bank have been retained by GE. However, the sources quoted in the report could not specify the exact parts of the business that GE is planning to offload through the auction
The Journal further said that software firms and industrial companies which are on the lookout of ways to scale up their own digital efforts are among the list of potential buyers that have been shortlisted by GE.
In 2015, former Chief Executive Jeff Immelt oversaw the setting up of the GE Digital business unit. That was a part of the vision of the then CEO of changing the outlook of the company into a “digital industrial” firm. But the company’s ambitions of industrial internet have bene scaled down by the new CEO John Flannery after the resignation of Immelt. The company is now more focused on its traditional core businesses.
The original plan of Immelt as stated by him was to convert GE into one of the top 10 software developing companies in the world by 2020 and for this purse the company had recruited thousands of software programmers. It had also made massive investments into research in this field. In 2016, analytics and machine learning software were created by the company with an investment of more than $4 billion, according to the news report in the Journal. The company also highlighted its digital business in its marketing strategies quite prominently and called for a new “digital industrial” age.
However, the more established software companies such as IBM Corp. and Microsoft Corp., as well as a number of startups offered a very strong challenge to the efforts and ambitions of GE.
Last year, there had been a sharp drop in the stock price of the company and the decision to restructure the company was announced by Flannery soon after. He has already also announced that there are plans to off load the gas services business unit – Baker Hughes. The report further said that the healthcare and railroad locomotive businesses of GE is being planned to be spun off. And instead, the company will shift complete focus to its core business sectors of aviation, power and renewable energy.
There was no comment made by GE about the news report.
(Adapted from Siliconangle.com)