Turning Out the Lights At GE?

We might be saying goodbye to GE in the electrical industry in the near future. Although the Appliance group is going first, could lamps be far behind? According to www.wsj.com today,

“General Electric plans to start an auction for its appliances business, people familiar with the matter said. If completed, a sale could end more than 100 years of GE’s involvement with appliances. GE has hired Goldman Sachs to run an auction for the appliances, or “white goods,” unit, which could fetch between $5 billion and $8 billion, the people said. With appliance sales getting hit by the slowing U.S. economy and the housing bust, jettisoning the business could help GE reach its long-term goal of boosting profits by at least 10% annually. “

While many in the industry have talked about the possibility, and reportedly it was almost done before, now it could be the destiny for the inventor of the light bulb.

And to help “pretty it up”, we understand that GE is offering a early retirement program to a number of people. While it helps improve profitability and was expected after their latest quarterly earnings report, it plays in well with trying to make the books look better as they prepare for a sale. Expect more cost cutting and efforts to increase the top line by taking market share (which may explain why they have been aggressively growing their retail presence and “buying” shelf space.
So the guessing game begins…who could be interested in lamps & gear? Could it be a private equity firm?, Samsung (makes for an interesting residential play)?, Matsushita (remember they own Universal Lighting Technologies and Panasonic)?, Toshiba?, ABB for the GE gear business?, a Chinese firm?, Would Cooper Industries expand into new categories (although this would double the size of the company)? How about Emerson or Danaher – two companies that like to make investments and keep standalone companies?

What do you think? How will this impact distributors?