Friday July 11, 10:11 AM
GE to sell Japanese consumer finance arm to Shinsei
TOKYO (AFP) - US conglomerate General Electric Co. will sell its Japanese consumer finance arm to Shinsei Bank (Berlin: LCJ.BE - news) in a multi-billion dollar deal, a newspaper reported Friday.
The US giant will sell GE Consumer Finance Co., which operates the Lake brand consumer lending business, for 580 billion yen (5.4 billion dollars), the Nikkei (news) daily said, citing unnamed sources familiar with the matter.
Shinsei, a mid-sized bank, offered a higher price than other bidders including Japan's biggest consumer lenders Acom Co (Frankfurt: 887795 - news) . and Promise Co (Frankfurt: 887932 - news) ., the report said.
Japan's consumer finance industry is facing tough times due to a worsening economy and stricter regulations.
A Shinsei Bank spokeswoman declined to comment on the report. She said an announcement was planned but did not offer further details.
GE, a broadly diversified company, has been affected by a global economic slowdown and credit crunch, with first-quarter profit falling six percent as its commercial finance arm took a hit.
GE, which was set to report its second-quarter results later in the day, said Thursday it was likely to spin off its industrial unit including its appliance division as part of a planned reorganisation.
Shinsei has also been hit by the global credit crunch and announced in March that it would sell its Tokyo headquarters for more than one billion dollars.
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