GE shakes up power unit leadership, taps retired executive to help
(Reuters) – General Electric Co shook up its ailing power business on Monday, appointing a new CEO for gas power and bringing a longtime GE executive back from retirement to help.
FILE PHOTO: The General Electric logo is pictured on the General Electric offshore wind turbine plant in Montoir-de-Bretagne, near Saint-Nazaire, western France, November 21, 2016. REUTERS/Stephane Mahe
The changes mark another step in new GE Chief Executive Officer Larry Culp urgent effort to reduce heavy debt and restore profits at the 126-year-old, Boston-based conglomerate. It also highlights the serious problems at GE’s power division.
“One of my top priorities is positioning our businesses to win, starting with GE Power,” Culp said in a statement.
GE stock was up 0.6 percent at $ 8.05 in morning trading.
John Rice, a 39-year GE veteran who once headed its energy unit, will now serve as chairman of gas power, reporting to Culp. Rice retired nearly a year ago after heading GE’s global growth efforts as a vice chairman under former CEO Jeff Immelt.
He will use “knowledge of GE’s gas customers and management experience” to provide “mentorship” to gas power leaders to “position this business and the team for success,” GE said.
Scott Strazik, CEO of GE Power’s repair and maintenance business, will become CEO of Gas Power, overseeing both gas-related equipment sales and services.
GE Power’s current Chief Executive Officer, Russell Stokes, will become CEO of other power activities, including nuclear and coal power, steam, transmission grids and power conversion.
Strazik and Stokes also will report to Culp, GE said.
GE said last month that it would separate the gas power unit from the rest of its power activities so the unit could receive extra management focus.
GE Power’s profits have plunged as demand for gas turbines has fallen far short of forecasts, leaving GE and rivals Siemens and Mitsubishi Hitachi Power Systems with too much capacity and fewer sales.
GE Power reported a $ 631 million loss and wrote off $ 22 billion of goodwill in the third quarter, reflecting the bleak outlook for future earnings.
Reporting by Arunima Banerjee in Bengaluru; Editing by Saumyadeb Chakrabarty and Nick Zieminski