General Electric (GE) this week ousted John Flannery, replacing the CEO with outsider and board member Larry Culp. Reuters reports that the firm also said that it would take a c. $23bn charge to write-off goodwill in its power division, primarily from a large 2015 acquisition.
The GE share price has more than halved since Flannery, a 30-year GE veteran, became CEO in August 2017, replacing Jeff Immelt, who had led GE since 2001. However, the share jumped c. 7% on Monday as investors digested the news and seemed to believe that Culp could re-energise the GE brand and more quickly transform its portfolio.
Last year, GE Power’s falling profits forced GE to cut its overall profit outlook and slash its dividend for only the second time since the Great Depression, according to Reuters.
GE’s board unanimously picked Culp as its new CEO. Culp, was CEO of industrial equipment supplier Danaher Corp from 2000 to 2014.