Tomahawk, WI 03/27/2014 (Basicsmedia) – General Electric Company (NYSE:GE) is returning to its industrial and manufacturing roots and with its manufacturing prowess in a range of high-tech areas including aircraft engines and power turbines, GE is one company that is for built to last. GE will be showing strong revenues and profits 10, 20 and even 50 years in the future.

Synchrony Financial IPO

By seeking to spin off its North American retain finance unit into a separate entity called Synchrony Financial, General Electric Company (NYSE:GE) will be able to insulate itself better from the vagaries of the financial sector which cost GE a lot during the 2008 financial crisis.

During the 2008-09 financial crisis, GE was generating more than half of its profits from its finance arm, GE Capital. This cost GE dearly as its stock price fell into the single digits and it was forced to slash its dividend payouts. With the divestiture of the North American retail finance unit, GE Capital will become a smaller part of GE’s entire suite of businesses and will constitute about 30% of the company’s total earnings.

The IPO of GE’s North American retail finance unit is the 1st step. It will offload about 20% of its stake in this unit via the IPO. Then, GE might offload the rest of its stake next year by making an offer to its existing shareholders to swap GE shares with Synchrony shares.

The time is also right for this IPO as store sales through credit cards have expanded in recent years. With the economy in better shape, with an IPO now, General Electric Company (NYSE:GE) will be able to maximize value for shareholders. It’s a sign of great management and mature decision-making to have waited for the economy to improve. GE will likely raise about $3.5 billion from the impending IPO and expect a valuation in the $20 to $25 billion range for Synchrony.

Warren Buffett Loves GE Too

After buying $3 billion in perpetual preferred General Electric Company (NYSE:GE) stock back in 2008 that came with an exceptional 10% annual dividend, now the Oracle from Omaha has increased his GE holdings by 1,700% during 4Q2013 through Berkshire Hathaway Inc. (NYSE:BRK.A).

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