General Electric Co. is discussing the sale of parts of its finance business, including the $74 billion U.S. commercial-lending unit, with potential buyers including Blackstone Group LP, Mitsubishi UFJ Financial Group Inc. and Wells Fargo & Co., people with knowledge of the matter said.
Also interested is Apollo Global Management, said the people, asking not to be identified discussing private information. Talks are at an early stage and no sale is imminent, the people cautioned. GE thinks it can sell the majority of the financial assets by the end of 2015, one person said, ahead of its stated goal of the end of next year.
GE said April 10 that it will sell the bulk of its lending unit in a sweeping move that will return the company to its industrial roots. Large banks including U.S. Bancorp and JPMorgan Chase & Co. have said they will look at the assets, and Wells Fargo and Blackstone already agreed to purchase most of GE’s real estate in a deal valued at $23 billion.
A representative for GE declined to comment, as did a U.S.- based spokesperson for Japan’s Mitsubishi UFJ and a representative for Wells Fargo. Blackstone and Apollo didn’t respond to requests for comment. The Wall Street Journal earlier reported that Wells Fargo was among the parties interested in the commercial-lending unit.
GE shares fell 0.6 percent to $26.84 at 9:42 a.m. in New York. They have risen 6.9 percent this year through Monday compared with a 2 percent increase in the Standard & Poor’s 500 Index.
GE has held talks with “a broad geographic spectrum” of buyers, including sovereign wealth funds and banks, as part of the effort to sell about $200 billion in financial assets, Chief Financial Officer Jeff Bornstein told Bloomberg last week.
The U.S. operations provide financing ranging from equipment leasing to commercial loans to a variety of industries, and make up the bulk of GE’s commercial lending and leasing division.
Wells Fargo had $271 billion commercial and industrial loans as of March 31, a 13 percent increase from a year earlier. The San Francisco-based firm considers itself the largest U.S. middle-market commercial lender, based on lead banking relationships, according to a February presentation.
GE’s businesses for sale include the international consumer-lending platforms and commercial-financing business. Once the restructuring is complete, GE Capital will make up less than 10 percent of operating earnings, GE has said, down from 42 percent in 2014.