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Analysts said the operation would largely offset the company's pension obligations due to falling interest rates and basically consistent with the steps taken by chief executive Culp (Larry Culp) over the past year. Culp aims to increase company cash and cut 105 billion 800 million US dollar debt.
Culp reduced GE's quarterly dividend to a penny and has sold or announced plans to sell non core assets. After downsizing, the company will focus exclusively on equipment and services related to power plants, aircraft engines and wind power stations.
GE's pension plan is one of its biggest debt burdens, with a funding gap of about $27 billion by the end of 2018. American employees facing a pension freeze will be transferred to fixed-contribution pension schemes, such as 401 (k) schemes, in 2021.
It is difficult for companies to boost profits in the face of sluggish demand for generating gas turbines. At the same time, its aircraft engine business may also suffer losses of more than $1 billion due to the grounding of Boeing (BA.N) 737 MAX.
GE may have to allocate about $11 billion to repay its long-term care insurance business.
The company said it expects to reduce the pension gap by $5 billion to $8 billion by freezing pensions for U.S. employees, prepaying $4.5 billion for 2021 and 2022, and offering one-off buyouts to 100,000 retired employees who have not yet started receiving monthly pensions.
Nicholas Heymann, an analyst at William Blair & Co., said GE's pension burden would not immediately decline net, as long-term interest rates fell 90 basis points since the end of last year, raising its pension burden from 27 billion at the end of 2018 to about 34 billion.


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