GE Looks to Speed Up Separation from Baker Hughes
Baker Hughes, a GE company (BHGE) and General Electric Company (GE) are pressing forward with their plans to separate as the companies jointly announced Nov. 13 their entrance into a series of long-term agreements.
BHGE and GE agreed on a release from the lock-up restrictions under their stockholders agreement which previously prevented GE from getting rid of BHGE common stock shares until July 2019.
The two companies agreed to a proposed sale by GE of part of its stake into the market as well as a repurchase of another part of GE’s stake by BHGE.
These transactions will keep GE’s stake in BHGE above 50 percent.
“Earlier this year we announced our intent to pursue an orderly separation from BHGE. The agreements announced today accelerate that plan in a manner that mutually benefits both companies and their shareholders,” GE’s CEO H. Lawrence Culp, Jr., said in a company statement.
BHGE CEO Lorenzo Simonelli said the agreements provide clarity for customers, employees and shareholders.
“We remain well positioned to capitalize on the positive outlook for our industry and are focused on our top priorities of gaining share, improving margins and generating cash,” Simonelli said.
The other agreements focus on:
Long-term collaboration on critical rotating equipment, including aeroderivative and heavy-duty gas turbine technology.
BHGE access to GE Digital software and technology.
A series of agreements relating to operations and pricing within BHGE Digital Solutions’ Controls product line, pensions, tax matters and intercompany services costs.