What is the primary purpose of this 8-K filing?

This 8-K filing is primarily to revise certain financial information in GE's 2014 Form 10-K. Specifically, it reclassifies most of the Commercial Lending and Leasing (CLL) business and the Real Estate business to 'discontinued operations' as part of the larger GE Capital Exit Plan.

What is the GE Capital Exit Plan?

The GE Capital Exit Plan is a strategic initiative announced by GE to significantly reduce the size of its financial services businesses over the next 24 months. The goal is to sell most of GE Capital Corporation's (GECC) assets and focus GE's resources and investments on its industrial businesses. GE will retain certain GECC businesses that directly support its industrial operations.

What are the estimated financial impacts of the GE Capital Exit Plan?

GE estimates incurring approximately $23 billion in after-tax charges through 2016 related to the plan. Of this amount, approximately $6 billion is expected to result in future net cash expenditures. Significant charges have already been recorded in the first and second quarters of 2015.

How does the company plan to manage GECC's debt during this transition?

GE has provided a full and unconditional guarantee for approximately $210 billion of GECC's outstanding long-term debt and commercial paper as of April 10, 2015. Additionally, GECC will be merged into GE, and a new intermediate holding company will be created to hold GECC's businesses post-exit, ensuring compliance with debt covenants and working towards terminating GECC's designation as a systemically important financial institution (SIFI).

GE 8-K SEC Disclosure — Aug 7, 2015

Summary

General Electric (GE) filed this 8-K to revise its 2014 Form 10-K, reclassifying most of its Commercial Lending and Leasing (CLL) business and its Real Estate business to discontinued operations. This action is a key component of the broader GE Capital Exit Plan, aimed at significantly reducing the size of GE's financial services arm and refocusing on its industrial businesses. The company anticipates substantial after-tax charges through 2016 as a result of these dispositions and related strategic moves, including estimated charges of $23 billion by 2016, with approximately $6 billion expected to result in future net cash expenditures. GE has already recorded significant charges in the first and second quarters of 2015 related to this plan.

Key Highlights

1Reclassification of most Commercial Lending and Leasing (CLL) and the Real Estate business to discontinued operations, impacting the 2014 Form 10-K financial reporting.
2The reclassifications are part of GE's strategic 'GE Capital Exit Plan' to divest significant portions of its financial services business and concentrate on industrial operations.
3GECC will merge into GE, and a new intermediate holding company will be created to manage remaining GECC businesses, aiming to comply with debt covenants and terminate GECC's designation as a SIFI.
4Agreements for the sale of substantially all of GECC's Real Estate debt and equity portfolio to funds managed by The Blackstone Group (with a portion to Wells Fargo) were valued at approximately $26.5 billion.
5GE issued a full and unconditional guarantee of approximately $210 billion of GECC's outstanding long-term debt and commercial paper as of April 10, 2015.
6GE estimates incurring approximately $23 billion in after-tax charges through 2016 due to the GE Capital Exit Plan, with $6 billion projected as future net cash expenditures.
7Significant after-tax charges of $16.1 billion (Q1 2015) and $4.6 billion (Q2 2015) were recorded related to the plan, with substantial portions reported within discontinued operations.

GENERAL ELECTRIC CO 8-K Report, Corporate Update (Aug 7, 2015)

Summary

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