Company
GE

GE ousts CEO John Flannery as it announces $23b writedown

Burgess COMMENTARY

Peter Burgess

GE ousts CEO John Flannery as it announces $23b writedown

Former General Electric chairman and CEO John Flannery.


RICHARD DREW/ASSOCIATED PRESS. Former General Electric chairman and CEO John Flannery. In a stunning move, General Electric Co. said Monday it replaced John Flannery as chairman and CEO just more than a year after he took over the struggling company. The Boston-based industrial giant said its board named H. Lawrence Culp Jr. to replace Flannery. Culp, 55, ran Danaher Corp. from 2000 to 2014. GE also said it will take a massive writedown at its troubled power unit that will total as much as $23 billion, and withdrew its earnings and cash flow guidance for 2018. Shares of GE jumped more than 15 percent to $13.05 in pre-market trading. The stock had fallen more than half in the past year, and was removed from the Dow Jones industrial average in June. “While GE’s businesses other than Power are generally performing consistently with previous guidance, due to weaker performance in the GE Power business, the Company will fall short of previously indicated guidance for free cash flow and EPS for 2018,” GE said in a statement. The board appointed Thomas W. Horton as lead director. Culp and Horton have been members of the board since April 2018. GE said that Culp oversaw a transformation of Danaher from an industrial manufacturer into a leading science and technology company. During his 14 years at the head of Danaher, the company’s market capitalization and revenues grew five-fold, the company said.