GENERAL ELECTRIC has cut its divisions to four from six as its chief executive, Jeffrey Immelt, axes slow-growing businesses while the company's shares trade near a five-year low.
The main divisions will now be GE Technology Infrastructure; GE Energy Infrastructure; GE Capital and NBC Universal, the US multinational announced on Friday.
The new structure emphasises Mr Immelt's priorities as he tries to shield GE, one of the world's biggest companies, from economic swings by divesting consumer units and exploiting its role as the world's biggest maker of power-plant turbines and jet engines.
About $US81 billion ($84.7 billion) of GE's market value has been lost since April, when the chief executive disclosed an unexpected first-quarter loss that he blamed on turmoil in financial markets.
"I appreciate the idea of breaking up infrastructure to highlight the technology aspect," said one New York analyst, Robert Schenosky.
"Where I do get concerned about the consolidation from six groups to four is the level of transparency we may get."
In particular, the formerly separate health-care group that is now folded into the technology infrastructure unit is one area where performance would be harder to track, he said.
Mr Immelt has sold the slower-growing and capital-intensive businesses such as insurance and plastics for more than $US55 billion and made more than $US80 billion in acquisitions in health care, water treatment and power-generation equipment.
Analysts have called for a simpler, easier to understand grouping. "We can structure the company in a simpler way that can maximise future growth," Mr Immelt said.
The GE chief said he intended to change the product mix to about 60 per cent non-financial by 2010, making it more valuable to investors who assign higher values to industrial companies.
GE's stock price is about 13 times estimated earnings for the next 12 months.
In a regulatory filing to the Securities and Exchange Commission, GE said it had reduced its residential mortgage-backed securities by $US500 million, or 8.6 per cent, in the past three months.
GE held about $US5.3 billion in residential mortgage-backed securities as of June 30, down from $US5.8 billion at the end of the first quarter.
The company also reduced its commercial mortgage-backed securities to $US2.7 billion, down from $US2.8 billion held as of March 31.
It also said it had reduced its exposure to subprime credit in its residential mortgage-backed securities from $US1.8 billion to $US1.7 billion.
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