June 5, 2019
General Electric (NYSE:GE) is reportedly shopping its venture capital portfolio as it looks to rein in its debts in a multi-year turnaround.
GE Ventures, founded in 2013, backs more than 100 start-ups across the healthcare, tech and energy sectors. It’s been seeking suitors for several months among other venture shops and limited partner groups that back their funds, according to CNBC, which cited “people familiar with the matter.”
GE shares were off -19.4% over the past 12 months as of yesterday’s close despite gaining 43.8% in 2019. The Boston-based conglomerate faces a $110 billion debt load, according to the network, and is in the midst of a multi-year turnaround it hired former Danaher (NYSE:DHR) chief Lawrence Culp Jr. to engineer.
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GE Ventures is telling potential buyers that it’s loathe to deal out its holdings piecemeal, the sources said, meaning that the acquirer would have to buy both the successful startups and their less-successful brethren.
“During this time of transformation for GE, we are evaluating strategic options for GE Ventures to continue delivering returns for our shareholders and partners,” spokeswoman Megan Newhouse told CNBC in prepared remarks. “While we can’t comment specifically on that process, we remain committed to supporting our portfolio companies, business units and partnering with the entrepreneurial ecosystem.”
Citing two of the anonymous sources, CNBC reported that GE Ventures tapped Lazard to manage the deal. Lazard declined to comment, the network reported.
In January, Culp tabled the pending spinout of GE Healthcare to focus on the $21 billion sale of its biopharmaceuticals business. GE tapped Culp for the corner office last October.
A year ago GE said it was looking to sell 20% of GE Healthcare, with the rest distributed to existing shareholders as part of the spinout into a separate, publicly traded firm. By last November Culp was saying that more than 20% could be on the block, but the biopharm transaction scuttled those plans at least for this year, he said.
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GE shares closed up 0.3% at $10.31 apiece yesterday.