If you own stock in General Electric Co. – and many in northwestern Pennsylvania do – there is good news in the company’s decision to sell its remaining stake in NBC Universal to Comcast Corp.
The stock is up 3 percent so far today. At 10:30 a.m. it was trading at $23.31 a share – its highest price since October 2008.
In addition, GE Chief Executive Jeff Immelt said this morning that the company expects to return about $18 billion to shareholders through share buybacks and dividend payments as a result of the deal.
The deal is another step toward Immelt’s goal of refocusing GE on its core industrial roots, a shift that has also meant scaling back its GE Capital finance arm.
“This is a big event,” Immelt said. “Around the portfolio, the focus is on getting the industrial earnings mix up to 60, 65, 70 percent (of total company profit) over time …. We’re always going to look at ways to do that by growing our earnings and reducing GE Capital.”
GE acquired NBC in 1986, a deal that gave it its iconic New York building at 30 Rockefeller Center, and for years company officials argued that the growing entertainment empire, which later expanded to include Universal studios, was an important part of its diversification strategy.
But GE gave up on that approach, selling 51 percent of NBC Universal to Comcast in early 2011, after concluding that the industrial disciplines that made the company the world’s largest maker of jet engines and electric turbines did not apply to entertainment.