GE announced yesterday its board of directors has voted unanimously to name H. Lawrence Culp Jr. chairman and chief executive officer of the Boston-based company, “effective immediately.”
Culp, 55, a board member since April, succeeds John Flannery.
Culp said in a statement, “We have a lot of work ahead of us to unlock the value of GE.”
Culp was CEO and president of industrial manufacturer Danaher Corp. from 2000 to 2014.
Additionally, fellow board member Thomas W. Horton, 57, a onetime chairman and CEO of American Airlines, has been appointed lead director. Horton also previously worked as chief financial officer of AT&T.
GE cited “weaker performance in the GE Power business” as one reason for the change at the top.
“GE remains a fundamentally strong company with great businesses and tremendous talent,” said Culp. “It is a privilege to lead this iconic company. We will be working very hard in the coming weeks to drive superior execution, and we will move with urgency.
“We remain committed to strengthening the balance sheet. … Tom and I will work with our board colleagues on opportunities for continued board renewal,” he said. “We have a lot of work ahead of us to unlock the value of GE. I am excited to get to work.”
Horton said he’s looking forward to revitalizing GE as a company with growth and long-term success.
Flannery began a restructuring of GE in August 2017, when he replaced Jeffrey Immelt, whose efforts to create a higher-tech version of GE proved unsuccessful.
However, in Flannery’s short time, GE’s value has dipped below $100 billion and shares are down more than 35 percent this year, following a 45 percent decline in 2017.
The company was booted from the Dow Jones Industrial Average this summer and, last month, shares tumbled to a nine-year low after revealing a flaw in its marquee gas turbines, which caused the metal blades to weaken and forced the shutdown of a pair of power plants where they were in use.
GE also warned that it will miss its profit forecasts this year and it’s taking a $23 billion charge related to its power business.
Investors will want Culp to “clean house, and fast,” said Scott Davis, founding partner of Melius Research, in a research note where he compared GE’s recent history to a slow but fatal train wreck.
“If I’m a GE employee today, I’m happy for the turnaround, but expectations are about to get a whole lot higher. … GE employees will either step up or will be replaced,” Davis said.
Shares of General Electric Co., based in Boston, surged 11 percent in midday trading.
Herald wire services contributed to this report.