GECAS is a strong business and has reported solid results consistently which makes it a valuable asset. This sale will generate much-needed cash for the troubled conglomerate and will help streamline operations, in line with the company’s plans.
GE has been struggling for quite a while and the company announced in 2018 that it was planning to divest several of its units in order to focus primarily on its power, aviation and renewable energy businesses. The difficulties faced by the company eventually led to the exit of CEO John Flannery who was replaced by Larry Culp in October.
General Electric misses on Q3 estimates, cuts dividend again
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It was also reported that the power division was experiencing weaknesses that would cause the company to miss its guidance for earnings and free cash flow for 2018. GECAS is a part of the GE Capital division, and the sale of the aircraft-leasing operations is expected to help reduce debt and improve GE’s overall credit rating.
Over the past one month, GE’s shares have gained 17%. The stock was up 4.9% as of 11:15 am ET.