General Electric has agreed to sell a portion of GE Lighting to a company led by a former GE Lighting executive.
GE has agreed to sell GE Lighting’s business in Europe, the Middle East, Africa and Turkey, as well as its Global Automotive Lighting business. The company previously announced plans to sell both GE Lighting and Current, a unit that spun out from GE Lighting in 2015.
The buyer is a company led by Joerg Bauer, who previously served as president of GE Hungary, which is where the business unit being sold is headquartered.
The deal involves “all of GE Lighting’s business in EMEA, including our commercial operations, manufacturing plants, office sites, employees and equipment throughout the region” as well as the automotive business, according to an internal GE Lighting memo obtained by Crain’s. The memo is attributed to GE Lighting president and CEO Bill Lacey. The sale “also would include use of the GE Lighting brand during a transition period, after which the new organization would develop, manufacture and sell products under the iconic Tungsram brand,” Lacey stated in the memo. GE acquired Tungsram in 1989.
The memo also noted that GE Lighting’s “North American Consumer business and other assets continue to be marketed as part of a separate sale.”
The new sale agreement, announced internally on Wednesday, Feb. 14, “does not impact the team at Nela Park” in East Cleveland, where GE Lighting is based, according to a statement from Alicia Gauer, director of communications at GE Lighting. The deal also doesn’t include GE’s Current business unit, though it is for sale, she noted.
General Electric announced in June 2017 that it was in talks to sell GE Lighting, but at the time Gauer told Crain’s that the proposals being discussed did not include Current. GE made public its plans to sell Current in November, she noted.
Revenue for GE’s lighting unit, which includes GE Lighting and Current, fell to $546 million in the fourth quarter of 2017, down 7% from $584 million during the fourth quarter of 2016. Revenues for Current jumped 9%, but GE’s traditional lighting business fell 21%, according to a news release announcing GE’s fourth quarter results.