There are divestitures, believe it or not, that the selling company prefers to conduct on the down-low. Why panic the rank and file employees, the thinking goes, or create a situation where the press is demanding updates and you won't have anything to say for months?
And then there is the Jeff Immelt approach, now on display in the sale of General Electric Co.'s Appliance division. The GE chairman is currently barnstorming Asia, drumming up interest in the unit among likely buyers such as South Korea's LG Electronics and China's Haier Electronics Group Co. Ltd. OK, maybe he has some other business out that way as well; for one thing, GE recently announced plans to more than
double its China revenues by 2010, increase its deal team there and make up to $2 billion worth of acquisitions in the period.
But it is Immelt's enthusiastic auctioneering that's getting the headlines at the moment -- to the point where one potential buyer might even be wishing he'd tone it down a bit. In Seoul, Immelt had great things to say about LG as a
potential owner of the business. This, despite the fact that analysts are skeptical about LG's need for the unit and ability to finance a purchase, and investors are driving LG's stock down on speculation about its interest in a deal.
Of course, it's GE's shareholders Immelt is thinking about. And even though the timing for this sale isn't ideal (private equity buyers are probably sidelined by the credit crunch, and the housing crisis isn't good for refrigerator sales), give him credit for stoking the competition. Besides naming a world of potential strategic buyers for the unit, he's also held out the possibility of
spinning it off to shareholders. -
Kenneth Klee
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