GE nominates three new directors to its board

CNBC

  • GE nominated top aviation and industrial executives and an accounting expert to its board on Monday.
  • The struggling company seeks to restructure its business and restore investors’ confidence in one of the largest U.S. industrial conglomerates.
  • GE said on Friday that it was facing potential legal action by the U.S. Department of Justice in connection with subprime mortgages and it is also restating its 2016 and 2017 results.

One of the new directors named on Monday was Leslie Seidman, a former JPMorgan Vice President and chairman of the Financial Accounting Standards Board nicknamed “Loophole Leslie” by opponents for her bank-friendly approach to regulation after the 2008 financial crash.

The other two were Thomas Horton, who oversaw the restructuring and merger of American Airlines with US Airways, and Lawrence Culp Jr., who as former CEO of Danaher transformed the company from a manufacturer into a science and technology firm.

Chief Executive John Flannery has promised to revamp GE into a leaner company by exiting several businesses and the company has already announced a series of job cuts to lower costs that have dented profits and disappointed investors.

Horton, also a director at Walmart, was chief financial officer at AT&Twhen it combined with fellow telecoms Cingular and SBC in 2005, and is currently at the forefront of merger negotiations between chipmakers Broadcom and Qualcomm.

“We are adding proven world-class expertise in capital allocation, aviation, accounting and financial reporting,” GE Lead Director Jack Brennan said.

Analysts, however, said the nominations to the board — to be cut to 12 directors from a previous 18 and voted on by shareholders in April — would do little to distract from the problems accumulating for GE.

“This remains a ‘liability story’,” JP Morgan analyst Stephen Tusa said. “We see weak core free cash flow as too structurally challenged to de-lever the balance sheet, leaving the company prone to risks around further contingent liabilities, and/or capital markets volatility.”

GE said nine of the company’s directors will stand for re-election including major shareholder Trian Fund Management’s Edward Garden, who was appointed to GE’s board in October.

GE’s stock fell 45 percent last year and is down another 17 percent so far in 2018.

2 thoughts on “GE nominates three new directors to its board

  1. Pingback: GE nominates three new directors to its board | PenneyVanderbilt

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