NEW YORK, Nov 19 (Reuters) - A recent sell-off in the stock of Baker Hughes, a GE-owned company, might mean a chance to buy the shares at a bargain, a report in Barron’s financial newspaper said.
The stock lost 7.4 percent over two days last week after General Electric outlined steps to shrink its array of businesses. It said it planned to get rid of its 62.5 percent stake in Baker Hughes.
GE, which completed its merger with Baker Hughes in July, is required by contract to wait two years from the completion date before it can sell unless Baker Hughes gives it permission to start exiting before then, Barron’s said in its Nov. 20 edition.
It would be relatively easy to spin off because Baker Hughes is already a publicly traded company, according to Melius Research analyst Scott Davis, quoted in the Barron’s article.
If GE exits, Baker Hughes will still benefit from its relationship with GE, and the stock would also benefit if the energy sector starts to rally, Barron’s said.
Baker Hughes shares closed Friday at $30.91, up 2.5 percent. (Reporting by Caroline Valetkevitch; Editing by Peter Cooney)