(Adds GE Capital background, stock's decline)
By Anjuli Davies and Sven Nordenstam
LONDON/STOCKHOLM, March 31 U.S. conglomerate
General Electric Co is exploring the sale of its GE Money
Bank unit in the Nordic region, which could fetch up to 2
billion euros ($2.75 billion), as it retreats from the finance
sector, sources close to the matter told Reuters.
GE Money Bank, established in the Nordic market in 1993, is
part of General Electric's finance arm GE Capital, which is
working with Bank of America Merrill Lynch to review its
options, three sources said.
Both GE and Bank of America declined to comment.
GE is seeking to reduce its exposure to the volatile banking
sector, which hurt the company during the 2008 financial crisis.
Potential buyers for GE Money Bank Nordics include private
equity firms as well as strategic players with a consumer
finance presence in the region, the sources said.
GE Money Bank Nordics employs 800 people with a presence in
Denmark, Norway and Sweden. It is active in loans and credits,
credit cards, deposits and insurance.
GE is aiming to increase its earnings mix to at least 70
percent from its industrial manufacturing businesses by 2016, up
from about 55 percent last year, which would reduce the profit
contribution from its GE Capital business to about 30 percent.
Earlier this month, GE's North American credit card unit
filed for an initial public offering, the first step in GE's
previously disclosed plan to exit retail finance in the region.
The credit card unit, to be known as Synchrony
Financial, could be worth more than $20 billion, according to
The conglomerate has already sold its consumer credit
business in Austria and Germany to Spanish bank Santander
and floated its Swiss consumer lending business,
renamed Cembra Money Bank.
Bank of America also acted as joint bookrunner on the Cembra
flotation in October.
The smaller GE Capital that remains will focus on lending in
sectors that complement GE's industrial businesses, such as
aviation and energy, as well as to middle-market businesses and
in commercial real estate.
GE shares slipped 5 cents to $25.83 in Monday afternoon
trading on the New York Stock Exchange. The stock, which is
among the 30 in the Dow Jones industrial average, has dropped
more than 7 percent this year, underperforming the broader U.S.
($1 = 0.7258 Euros)
(Additional reporting by Arno Schuetze in Frankfurt and Lewis
Krauskopf in New York; Editing by Mark Potter and Jan Paschal)