Jeff Immelt, who led General Electric for 16 years, is stepping down from his role as chairman and CEO, the company said Monday.
John Flannery, president and CEO of the conglomerate’s health care unit, will take over the post in August.
During Immelt’s 16 years as CEO, he succeeded in repositioning the company as Ohio’s largest manufacturing employer and producer of large industrial products but failed to fully revive its lagging stock price.
While GE credits Immelt with improving its financial performance and its focus, GE’s stock price has trailed the market with him as CEO.
The stock was worth a bit less than $40 on Immelt’s first day in 2001, with the U.S. in the middle of a recession. The stock briefly rose above $40 in 2007, just ahead of the economic crisis. It sank as low as $6.66 in March 2009 in the depth of the crisis, and closed at $27.94 a share Friday.
An investor who bought $1,000 in GE stock when Immelt took over would have $1,243 today, including dividends. The same amount invested in the S&P 500 index would be worth $3,206 today.
GE’s stock rose 4.1 percent to $29.10 in afternoon trading Monday before closing at $28.94, a 3.62 percent increase.
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General Electric is Ohio’s largest manufacturing employer of more than 15,000 people, according to state records, when including the GE Lighting division in the Cleveland area, GE Capital, and GE Aviation, which is headquartered in Evendale.
GE Aviation also has two locations in the Dayton area and remains one of the world’s biggest producers of jet engines.
Recent reports say GE is considering selling the lighting business, which could fetch about $500 million.
GE Aviation is at the tail end of a $500 million expansion in Southwest Ohio as the company builds a research lab for ceramic engine parts at Evendale and beefs up its 3-D printing capabilities following its 2012 acquisition of Morris Technologies.
The new GE Global Operations Center brought a new daytime population to Cincinnati’s riverfront, making it more than just a bar and restaurant district.
General Electric has also invested more heavily in new technologies, including a recent $1.65 billion acquisition of LM Wind Power, a Denmark-based manufacturer of rotor blades for wind turbines.
And the company’s future as a cutting-edge developer of big-data tools to design and maintain jet engines has taken root in Evendale, with the creation last March of digital division that now employs several hundred.
“He’s pretty much supported every development program we’ve proposed,” said GE spokesman Rick Kennedy. “He knows it’s a long cycle business. A lot of the decisions Jeff made in aviation will benefit (Cincinnati) 25 years from now. I mean, right now we’re booming because of decisions made in the mid-80s. You don’t get your return on investments in aviation for 15 to 20 years. Jeff has made a lot of decisions that’ll cast a big shadow for Cincinnati.”
The 61-year-old Immelt will stay on as chairman until his retirement from the position at the end of the year, with the 55-year-old Flannery stepping into the role after that.
Flannery is a longtime General Electric executive, starting his career at GE Capital in 1987. He became president and CEO of the company’s equity unit in 2002 and eventually joined the health care unit in 2014, focusing on advanced technologies.
Also on Monday, Chief Financial Officer Jeff Bornstein was named vice chair and Kieran Murphy was named president and CEO of GE Healthcare to succeed Flannery.
This article contains reporting by the Associated Press and Journal-News media partner WCPO