GE Still Bringing Good Things to Life
We took the subway out and whisked through the entrance. The first place I wanted to go was General Electric's (GE) "Carousel of Progress." It was a theater that turned from one animated scene of the future to another. I was spellbound.
GE isn't as spellbinding today as it was back then, but it still captures both my attention and my imagination. For instance, on 12/12/12 (Wednesday) the Office of the Comptroller of the Currency approved GE Capital's acquisition of MetLife's (MET) deposit business for $6.5 billion.
This "brings good things to life," and as TheStreet.com's Research Director Stephanie Link characterized this transaction, "... (I)t provides a critical addition to GE Capital's Consumer Finance business and the ability to self-fund its private-label credit card receivables."
Jim Cramer, in his own commentary, wrote recently that the move "in itself is a positive, but to take it one step further, there is now a possibility that General Electric could spin out the GE Consumer Finance division at some point.
"For perspective, GE Consumer Finance accounts for about 20% of total General Electric revenue. Should it make this move, the story gets more simple, as General Electric would become more of a pure-play industrial company and offer a higher multiple than the hybrid (quasi industrial/financial) seen right now."
I couldn't agree more.
Jim Cramer and Stephanie Link actively manage a real money portfolio for his charitable trust- enjoy advance notice of every trade, full access to the portfolio, and deep coverage of the latest economic events and market movements.