GE HealthCare's stock pulls back after former parent sells off half its stake

By Tomi Kilgore

Stock set to snap four-day win streak, while GE Aerospace's stock rallies toward a 16-year high

Shares of GE HealthCare Technologies Inc. are ending a good week on a negative note on Friday, after its former parent, now known as GE Aerospace, took advantage of the recent rally to sell off about one-half of its remaining stake.

With GE Aerospace raising more than $1.3 billion, the share sale helped lift its own stock toward a 16-year high.

The medical technology and drug diagnostics company (GEHC), which was spun off from the former General Electric (GE) in January 2023, announced around 5 p.m. Eastern a public offering of 10 million shares.

Hours later, the company said the offering was up sized by 50%, to 15 million shares. The offering was priced at $86 a share, or 1.7% below Thursday's closing price of $87.46.

GE HealthCare's stock fell 1.3% in midday trading Friday, after rallying 2.8% over the past four sessions. Even with Friday's decline, the stock was still headed for its highest weekly close in five months.

The company said it wouldn't receive any of the $1.31 billion in proceeds from the sale, as all of the shares being sold were previously owned by GE Aerospace.

GE Aerospace's stock (GE) surged 3.2% midday Friday, to put it on track for the highest close since April 2008.

The company plans to use the proceeds from the stock sale to pay down debt.

GE Aerospace had disclosed in early-August that it had owned 30.53 million GE HealthCare shares as of June 30. As of March 31, 2023, GE Aerospace had owned 90.33 million shares.

With the sale, GE Aerospace's remaining 15.53 million-share stake, or 3.4% of the shares outstanding, would be worth $1.34 billion at current prices.

GE HealthCare's stock has run up 33.8% year to date while GE Aerospace shares have soared 93.3%. The S&P 500 index SPX has gained 18% this year.

-Tomi Kilgore

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

09-13-24 1151ET

Copyright (c) 2024 Dow Jones & Company, Inc.