GE Veteran John Rice Returns to Troubled Power Unit -- Update
November 19 2018 - 11:42AM
Dow Jones News
By Thomas Gryta
General Electric Co. said one of Jeff Immelt's top lieutenants
was returning to the company to help oversee a restructuring at its
problematic power division.
The company Monday said John Rice, who spent some four decades
at GE and had retired last year as vice chairman after Mr. Immelt's
exit as chairman and chief executive last year, would become
chairman of its gas power business.
New CEO Larry Culp is splitting the power unit into two pieces
-- one running its natural gas-fueled power generation business and
another group that will include coal and nuclear power
operations.
Mr. Rice, 63 years old, was formerly GE's top international
executive and ran GE's energy business, which included the power
business, from 2000 to 2005.
Mr. Rice spent his final years at GE in Hong Kong building the
company's business outside the U.S. and company officials called
him GE's Secretary of State. He is one of the GE appointed board
members at oil-services firm Baker Hughes, which is majority-owned
by GE.
Following the tumult in the boardroom and executive suite of the
past two years, Mr. Rice's return leaves him as one of the few of
his generation of GE leaders that will still be with the company.
Other than David Joyce, the longtime leader of GE's aviation, the
heads of GE's other major units have all changed.
GE has also switched CEOs twice and replaced its finance chief
in the past year. Mr. Culp, who joined GE's board in April, took
over as CEO on Oct. 1 after GE's board abruptly fired GE veteran
John Flannery after 14 months. Before him, Mr. Immelt led GE for 16
years.
GE Power, one of the conglomerate's oldest and biggest
divisions, has posted deep losses as management misjudged falling
market demand and the 2015 acquisition of Alstom SA's power
business added even more capacity. GE recently wrote off the entire
deal as part of a $22 billion accounting charge in the third
quarter.
The unit makes the core of a power plant: massive turbines that
run on fuel to generate electricity. GE has said its equipment
generates a third of the world's electricity.
The division is also under federal investigation for its
accounting practices. The collapse of the business has reduced GE's
cash flow and pushed GE to slash its quarterly dividend twice over
the past year to a token 1 cent per share.
Under Mr. Flannery, the power division was combined in 2017 with
a former energy connections division run by Russell Stokes, who
became CEO of the enlarged power business. The latest shuffle
leaves Mr. Stokes, 47, in charge of everything except for the
natural-gas operations.
Scott Strazik, 40, formerly president of GE's power services
business, will be CEO of the gas power division with Mr. Rice as
chairman.
Write to Thomas Gryta at thomas.gryta@wsj.com
(END) Dow Jones Newswires
November 19, 2018 11:27 ET (16:27 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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