GE to record $3b insurance sale loss in Q4
NEW YORK (Bloomberg) ? General Electric Co., the world?s largest company by market value, will have about $3 billion of costs in the fourth quarter related to the sale of the company?s reinsurance business to Swiss Reinsurance Co. The loss from the sale of the business includes the writing down of goodwill, the company said in a regulatory filing last week. The charge won?t result in any future cash expenditures. General Electric announced on November 18 that it agreed to sell the unit for at least $6.8 billion in cash and stock. The transaction is the final major step in GE?s exit from insurance, part of chief executive Jeffrey Immelt?s plan to return profit growth to at least ten percent a year. The company raised its 2006 forecast for earnings from continuing operations to $1.92 to $2.02 a share, an increase of 12 percent to 17 percent, when the transaction was disclosed last week. At that time, Immelt said on a conference call with investor that GE would have a $2.8 billion loss on the sale. Selling the reinsurance unit will cut GE?s reliance on finance activities, which accounted for about half of sales and profit in 2004.