By: Scott Davis
GE is expected to liquidate its 62.5% stake in the Baker Hughes/GE Oil & Gas business and we propose that GE consider the exact opposite… With BHGE shares down ~30% from recent peak on January 12, 2018, a liquidation scenario would net GE ~$19B in gross proceeds (at mkt price) which could be used to pay down debt or fund the pension. But this sale would come at the oil & gas trough, and the overhang of the GE sale alone could be worth ~20% on BHGE’s stock price. GE has other assets to sell and with less P&L impact. BHGE sale timing at these levels seem ill advised.