The FINANCIAL — GE announced on September 1 that it has completed the previously announced sale of its U.S. fleet services business, representing aggregate ending net investment (ENI) of approximately $4.4 billion, to Element Financial Corporation (TSX:EFN) in a transaction valued at approximately $5 billion.
Separately, the previously announced sale of GE’s Mexican, Australian and New Zealand fleet businesses to Element is expected to close at the end of the third quarter, and the sale of GE’s European fleet businesses to Arval, a fully-owned subsidiary of BNP Paribas, is expected to close in the fourth quarter, according to GE.
“We are pleased to complete the sale of our U.S. fleet services business to Element,” said Keith Sherin, GE Capital chairman and CEO. “It is another important step as we continue to execute on our plan to sell most of the assets of GE Capital,” added Sherin.
As previously announced, GE is embarking on a strategy to focus on its high-value industrial businesses and is selling most GE Capital assets. GE and its Board of Directors have determined that current market conditions are favorable to pursue disposition of these assets. GE will retain the financing “verticals” that relate to GE’s industrial businesses.
The U.S. fleet services transaction releases approximately $0.6 billion of capital. GE Capital believes it is on track to deliver about $35 billion of dividends to GE under this plan, as previously announced (subject to regulatory approval).
Mr. Sherin concluded, “We wish our U.S. fleet services team a successful future as they join Element.”