Shares of General Electric (GE) - Get Report rose Wednesday after the beleaguered industrial icon announced it was selling its almost 130-year-old consumer lighting business to Savant Systems, a smart-home company.
Terms weren’t disclosed.
GE has been dumping assets for several years to shore up its weakened financial position. It already sold its commercial lighting business in 2018.
The company’s finances have grown increasingly dire during the coronavirus pandemic because a downturn in Boeing's (BA) - Get Report business has decimated its aviation division. That has led to thousands of layoffs in what was one of the few segments of the company that was performing well.
As for the lighting sale, “Today’s transaction is another important step in the transformation of GE into a more focused industrial company,” GE CEO Larry Culp said in a statement.
“Our GE Lighting colleagues will join a fast-growing leader in home automation that shares their passion for bringing the future to light. … At GE, we will continue to advance the infrastructure technologies that are core to our company,” the CEO added.
Last month, GE reported weaker-than-expected first-quarter earnings and warned that second-quarter results would decline further, amid a "material" hit from the global coronavirus pandemic.
GE said adjusted earnings totaled 5 cents a share in the latest quarter, down 64.3% from the same period last year and 3 cents shy of the Wall Street consensus forecast. Revenue fell 8% to $20.5 billion.
GE shares stood at $7.17 in premarket trading, up 5.44%. The stock has dropped 38% over the last three months and cratered 74% over the last five years.