General Electric is spinning out its $19 billion-a-year healthcare division, the latest in a series of business units affected by a restructuring.
The company revealed its plan to separate GE Healthcare into a standalone company on June 26, along with a plan to sell its remaining stake in the oil-services company Baker Hughes. Those two units will be the final ones affected in an ongoing effort announced last fall to sell $20 billion worth of assets. The Wall Street Journal initially reported the plan.
It’s the latest in a slew of sales at GE. The Boston-headquartered company announced plans to sell its industrial-engines division to private equity firm Advent International for $3.25 billion, and a month ago, it merged its railroad and locomotives business with another company in a deal valued at $11 billion.
GE Healthcare is among the largest of the conglomerate’s units affected in the shakeup, making up 16% of GE’s revenues last year. It’s also one that has a large Massachusetts connection, largely due to the headquarters for GE Healthcare Life Sciences which moved to Marlborough in 2015. The headquarters was said to be designed to employ around 500 workers at the time, although a more recent headcount hasn’t been disclosed by the company.
GE Healthcare also has facilities in Boston, Woburn, and East Bridgewater.
The unit, one of the company’s strongest divisions in recent years, is focused on medical imaging, monitoring, biomanufacturing, and cell and gene therapy technologies. In April, the company spun out part of that business, the Value-based Care Division, for $1.05 billion to private equity firm Veritas Capital.
GE will sell 20 percent of the healthcare division, then later will distribute the rest to existing shareholders. The new company will take on $18 billion in liabilities and will continue to be run by CEO Kieran Murphy.
The separation is expected to take 12 to 18 months.
