GE confirms plans to exit appliance business

The stock had its worst day in decades last month after the company reported a smaller-than-expected first-quarter profit and lowered its outlook for the full year.

Chairman and Chief Executive Jeff Immelt has rejected calls to sell NBC, though he has been under pressure to restructure the industrial and financial conglomerate, particularly since last month's surprising first-quarter earnings report that profit fell 6 percent.

GE's 101-year-old appliance business, headquartered in Louisville, Ky., has been hurt by the housing slump and economic slowdown in the U.S. The appliance division had revenue of $7 billion last year and employs about 13,000 people worldwide.

"GE Appliances has a very strong brand ... and for more than 100 years has been one of the icons associated with GE in the United States," Immelt said. "However, its remains primarily a U.S. business, meaning its fortunes are tied to the rise and fall of a single market."

The company is planning a strategic review that could result in an outright sale of GE Appliances, a strategic partnership or a spin-off to shareholders.

"This review is consistent with the strategy we have been executing to transform our portfolio for long-term growth," Immelt said. "Since 2003 we have exited slower growth and more volatile businesses, generating $52 billion in gross proceeds from dispositions. These proceeds have been reinvested into a transformed portfolio of faster growth, higher margin businesses, stock buybacks and other restructuring activities."

Analysts estimate sales in the appliance business are likely to decline between 10 percent and 12 percent this year. That stems from weak consumer spending and a drop in home improvement sales and residential construction.

Some have suggested a sale price in the low- to mid-$6 billion range.

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