Lease Team

GE $8.5bn healthcare sale

11/08/2015

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GE has announced the $8.5 billion sale of GE Capital Healthcare Financial Services to US bank Capital One. This is less than the $10-$11 billion mooted in the press from “people close to the matter” just three or four weeks ago.

GE Capital’s sale programme states that it plans to hang on to its healthcare arm, but the division just sold is distinct from one that GE is keeping, the latter division being the equipment finance business that finances the purchase of medical equipment by clinics and hospitals, roughly half of which are GE’s own scanners and MRI machines.

The division just sold lends to companies that specialise in senior housing, hospitals, medical equipment, and related businesses. It recorded c. $10.5 billion in financing for acquisitions, refinancings, working capital etc. in 2014, according to GE’s published information.

As the disposals at GE Capital accelerate, and clearly there appears to be no shortage of buyers for GE Capital assets, one does start to wonder if there will come a day when some regrets start to be expressed about this divestment programme having been too hasty, or perhaps even ill founded? Strategic planning has led many companies astray in the past, and as they say, you can only sell something once.



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