GE replaces its CEO

Eleanor Steed
By Eleanor Steed October 3, 2018 18:32

GE replaces its CEO

GE has named H. Lawrence Culp, Jr. as Chairman and Chief Executive Officer of the company by a unanimous vote of the GE Board of Directors, effective immediately.  Additionally, the GE Board has appointed Thomas W. Horton as Lead Director.

Culp will succeed John Flannery as Chairman and CEO.

While GE’s businesses other than Power are generally performing consistently with previous guidance, due to weaker performance in the GE Power business, the Company will fall short of previously indicated guidance for free cash flow and EPS for 2018.  In addition, GE expects to take a non-cash goodwill impairment charge related to the GE Power business. GE Power’s current goodwill balance is approximately $23 billion and the goodwill impairment charge is likely to constitute substantially all of this balance. The impairment charge is not yet finalized and remains subject to review. The company says it will provide additional commentary when it reports third quarter results.

Culp said, “GE remains a fundamentally strong company with great businesses and tremendous talent. It is a privilege to be asked to lead this iconic company. We will be working very hard in the coming weeks to drive superior execution, and we will move with urgency. We remain committed to strengthening the balance sheet including deleveraging. Tom and I will work with our board colleagues on opportunities for continued board renewal. We have a lot of work ahead of us to unlock the value of GE.  I am excited to get to work.”

Horton said, “Larry Culp has a proven track record in company transformation and delivering shareholder value. He is a strong leader with deep knowledge of industrials and technology, and an intense focus on execution, organization, and talent development. The board looks forward to working with Larry and his team to return GE to growth and long-term success.  On behalf of the board, I thank John for his significant contributions and long service to GE.”

Culp, 55, served as Chief Executive Officer and President of Danaher Corporation from 2000 to 2014. During his tenure he led the transformation of the company from an industrial manufacturer into a science and technology company.

Thomas W. Horton, 57, served as Chairman and Chief Executive Officer of American Airlines from 2011 to 2013, and Chairman of American Airlines Group from 2013 to 2014. During his tenure he led the restructuring of the airline and its eventual merger with US Airways. In addition to a deep knowledge of the aviation industry, Horton brings strong financial skills and corporate governance experience to the board, having served earlier in his career as the Chief Financial Officer of American Airlines and AT&T Corporation.

Eleanor Steed
By Eleanor Steed October 3, 2018 18:32