GE Said to Pick Banks for Australian Credit Unit SaleBrett Foley, Narayanan Somasundaram and Jonathan Browning
General Electric Co. is working with Morgan Stanley and Credit Suisse Group AG to study sale options for its consumer finance business in Australia and New Zealand, people with knowledge of the matter said.
The U.S. company will consider selling the GE Money unit, which provides personal loans and credit card services, to a buyer or through an initial public offering, said the people, asking not to be identified as the process is private. GE Money has about A$7 billion ($6.2 billion) of gross assets and may fetch more than A$1.5 billion, one of the people said.
GE has been shrinking its financial services arm GE Capital Corp. after it threatened to drag down the group during the 2008-2009 credit crisis. Chief Executive Officer Jeffrey Immelt has also sold the company’s century-old appliances unit, real estate holdings and a stake in NBCUniversal to focus on higher-margin industrial operations.
In July the Fairfield, Connecticut-based company sold a stake in its North American consumer-lending business Synchrony Financial in an initial public offering. It also spun off a majority holding in its Swiss consumer finance company Cembra Money Bank AG in October. Spain’s Banco Santander SA agreed in June to buy GE’s consumer finance unit in Sweden, Denmark and Norway for 700 million euros ($894 million).
The sale of the Australian consumer business fits GE’s strategy of focusing on infrastructure technology and providing finance to “mid-market” businesses, Luke Cuell, a Sydney-based spokesman for GE Money, said by e-mail. He declined to comment on the appointment of advisers.
“To achieve its full growth potential, our consumer business needs to be aligned with a company that has similar growth ambitions in the consumer space, or by establishing a standalone business,” Cuell said.
Spokesmen for Morgan Stanley and Credit Suisse declined to comment.
In addition to GE-branded credit cards and personal loans, the unit operates store cards for retailers including Myer Holdings Ltd. and Wesfarmers Ltd.’s Coles supermarkets, according to Cuell. It also has about 100 GE Money branches.