GENERAL Electric Co.’s (GE) new boss is giving the company a management makeover as he seeks to reverse its deep stock plunge—the biggest of the year on the Dow Jones Industrial Average.
CFO Jeffrey Bornstein is leaving, adding to an exodus of top executives that began shortly after CEO John Flannery won the top job more than three months ago. Two other longtime company veterans and GE vice chairmen, Beth Comstock and John Rice, are retiring from GE.
Flannery is tightening his grip on Boston-based GE as he seeks to cut $2 billion in costs by the end of next year amid pressure from activist shareholder Trian Fund Management. He’s also expected to outline his plans next month for a potential overhaul of the company’s portfolio, which includes jet engines, gas turbines, locomotives and ultrasound machines.
“This is part of maybe a transformational move that people are hoping for at GE,” said Todd Lowenstein, a fund manager at Highmark Capital Management, which owns GE shares. “The patience level of investors is obviously waning a little bit, and I think he feels compelled to move and show tangible results.”
GE fell less than 1 percent to $24.28 after the close of regular trading in New York. The shares have tumbled 23 percent this year, putting them on track for their worst performance in a calendar year since 2008.
‘That’s a statement’
Bornstein, who was promoted to vice chairman when Flannery was named CEO, will leave GE on December 31. Comstock, who has led efforts to accelerate new growth and helped spearhead digital innovation, will leave at the same time. So will Rice, a 39-year GE veteran whose most recent role was to lead the company’s Global Growth Organization.