GE Seeks To Raise About $3 Bln In Synchrony Financial IPO

(RTTNews) - General Electric Co. (GE) on Friday indicated plans to raise about $3 billion from the initial public offering of its North American retail finance business Synchrony Financial, according to a regulatory filing.

In the SEC filing, GE said it intends to offer 125 million shares of Synchrony Financial for $23 to $26 per share. The company has granted underwriters the option to purchase additional 18.75 million shares for over-allotment.

With the mid-point of the IPO range at $24.50 per share, GE expects to raise $2.9 billion in proceeds, or $3.4 billion if the over-allotment option is used. GE is targeting the IPO toward the end of July. Shares of Synchrony Financial will trade on the New York Stock Exchange under the symbol "SYF."

GE will own 85 percent of Synchrony after the IPO and distribute the remaining shares to its stockholders in a tax-free transaction. GE intends to use proceeds from the IPO to repay its debt, to increase its capital and to increase the size of its liquid portfolio.

Goldman Sachs & Co., J.P. Morgan, Citigroup, Morgan Stanley, Barclays, BofA Merrill Lynch, Credit Suisse and Deutsche Bank Securities are managing the IPO.

In March, GE had filed a registration statement for IPO of its retail finance business, as part of a planned stage exit from that business. Synchrony Financial handles store credit cards for major retailers like Gap, Walmart and JC Penney.

Under CEO Jeffrey Immelt, GE is seeking to reduce focus on its lending unit and concentrate more on its industrial businesses. Last month, GE agreed to buy power and grid business of speed-train maker Alstom SA (ALSMY, AOMFF, ALS.L) for about $17 billion.

On Friday, GE also reported a 13 percent increase in earnings for the second quarter, driven largely by strong performance at its industrial segment. Total revenues for the quarter grew 3 percent to $36.2. billion, while net income was $3.5 billion or 0.35 per share.

GE is currently trading at $26.35, down $0.26 or 0.98%, on the NYSE.