RitzBitz

General Electric Co.  (GE), Fairfield, Conn., announced plans to spin off its consumer and industrial division, home to its iconic light-bulb and appliance units, reports The Wall Street Journal. The announcement came 2 months after GE said it planned to sell the appliance unit — and Chairman Jeffrey Immelt listed potential buyers. People involved with the potential buyers say interest in the appliance business was less robust than anticipated. A sale also faced tax hurdles and branding questions. But a spinoff carries its own complications, notably how to spread the value of a relatively small company across GE’s share base of 10 billion.

  In the weeks ahead, GE is expected to hold management presentations with potential buyers of the appliance unit, says a person familiar with the matter. By flagging the spinoff option, GE may be hoping to push the parties — expected to include South Korea’s LG Electronics Inc., China’s Haier Electronics Group Co., and Mexico’s Controladora Mabe, a unit of Controladora Comercial Mexicana – to offer a full price. This person suggested that the final value of the appliance unit could be around $6 billion, says The Wall Street Journal.

  A GE spokesman said the company has received “overwhelming” interest in the appliance unit, but is now pursuing a spinoff because it would allow the company to handle the appliance and lighting units in a single transaction, independent of gyrating stock prices. He said either a sale or spinoff would likely include a license to continue to use the GE brand, reports The Wall Street Journal.

  The consumer and industrial businesses employ roughly 50,000 people. Besides light bulbs and appliances, the unit includes divisions that make motors and electrical equipment .