GE hires a new CFO. Task No. 1: Shrinking a mountain of debt
Posted November 25, 2019 10:14 a.m. EST
CNN — General Electric hired Carolina Dybeck Happe as its new finance chief, filling a vital role that will focus on cleaning up the iconic company's messy balance sheet.
Dybeck Happe, currently the chief financial officer of shipping giant Maersk, will join GE in early 2020, the company said Monday. The hire follows a four-month search for a replacement for Jamie Miller, the conglomerate's CFO since October 2017.
The transition comes at a critical time for GE. The maker of light bulbs, jet engines and MRI machines is in the midst of a fragile comeback from one of the darkest periods in its 127-year history. Last year, GE was kicked out of the Dow Jones Industrial Average, slashed its dividend to a penny and hired its third CEO in as many years.
GE's balance sheet is ground zero for its problems. The company piled up crippling amounts of debt following years of bad decisions. Dybeck Happe will lead GE's efforts to continue to whittle down that debt.
"She is a high-impact executive who brings a compelling blend of strategic and capital allocation discipline, well-honed operating skills, and transformational leadership abilities," GE CEO Larry Culp said in a statement.
In addition to serving as CFO, GE said that Dybeck Happe will lead the company's digital technology and global operations.
"She will be a strong partner as we execute our deleveraging plan and improve our operating results to position GE for sustainable, long-term value creation," Culp said.
Dybeck Happe was hired by Maersk earlier this year, leading the shipping company's efforts to pay down debt. Before that, she served as a senior executive at Swedish manufacturing conglomberate Assa Abloy.
"I've admired GE's team, technology, and global network and brand, and I am excited to join at a time of significant opportunity for the company and its stakeholders," Dybeck Happe said.
After a dreadful 2018, GE shares have spiked nearly 60% this year on signs the company is weathering a stormy environment better than feared. Not only has GE stopped burning through cash, the company has boosted its outlook for two quarters in a row.
Fears about GE's balance sheet have eased because the company has moved to rapidly pay down debt. To raise cash, GE has sold several major businesses, including its railroad division and its BioPharma unit. And last month, GE announced plans to freeze its US pension plan for about 20,000 workers and take other steps that will slash its massive pension deficit by $5 billion to $8 billion.
Yet GE still listed total borrowings of $93.2 billion at the end of the third quarter. GE's industrial business alone is sitting on $49 billion of net debt, down from $55 billion at the end of 2018.
GE announced in late July the unexpected departure of Miller, an 11-year veteran of the company. GE said Monday that Miller will stay onboard until Dybeck Happe takes over in early 2020.
"Jamie Miller exemplifies the spirit and dedication of our entire organization," Culp said. "Over her many years and roles with GE, she has been a resilient, respected leader and a mentor to many, especially our finance organization."