General Electric (NYSE:GE) stock is soaring as the company announced that it will be spinning off its digital assets into a new company.
The electric appliances maker said that it will spin off its digital assets and turn them into an independent internet of things (IoT) company, which is comprised of some of the technology surrounding GE Digital.
The company added that it will also be selling a majority stake in Service Max to private equity shop Silver Lake. The former is a software business that is part of GE Digital since the branch completed an acquisition for it for $915 million back in November 2016.
“As an independently operated company, our digital business will be best positioned to advance our strategy to focus on our core verticals to deliver greater value for our customers and generate new value for shareholders,” GE chairman and CEO Larry Culp said in a statement.
GE also said that the new IoT company will exist under its own brand, including a unique equity structure and an independent board of directors. Expect more details to be unveiled during the first quarter of 2019.
Additionally, the company announced that its current GE Digital CEO has departed the company. Additionally, the branch will examine candidates both internally and externally as it seeks out the CEO of its new independent company.
GE stock is soaring about 7.5% on Thursday