General Electric announced its farewell to the coal-fired power market.
The company, one world's largest coal power plant maker, announced on September 21 it will no longer provide equipment to new coal plants, although it will continue to serve existing customers.
GE stated this decision will involve asset sales and plant closures and layoffs.
After the announcement, GE's stock price fell by more than 7 percentage points on the day, closing at $6.35 per share.
Russell Stokes, GE senior vice president and president and CEO of GE Power Portfolio, said GE will focus on power generation businesses that are economically attractive and has a growth trajectory.
GE currently has five major business segments, namely power generation, renewable energy, aviation, medical and GE capital.
GE's power generation segment is composed of two parts. The business including thermal power and nuclear power, contributing $5.5 billion in revenue last year; the revenue of natural gas power generation reached $13.1 billion.
GE's renewable energy sector is parallel to the power generation sector, with revenue of $15.3 billion last year.
The withdrawal marked a dramatic shift in GE's development blueprint.
Five years ago, the company bet heavily coal by acquiring Alstom's power and grid sectors. The transaction reached up to $9.5 billion, the largest acquisition in its industrial purchase.
It turned out the transaction caused the company's disaster in the following years. Cleaner energy sources such as natural gas, solar, and wind were crushing coal's market share. GE suffered heavy losses as a result.
Withdrawing from the coal power market has become the company's CEO Larry Culp's latest move to reshape GE's power generation business.
John Inch, senior analyst at Gordon Haskett Research Advisors, told CNN the change proved the company's transaction with Alstom was unsuccessful. It also indicated GE might not be able to find any buyers for the asset for the time being.
In recent years, GE has successively hived off its locomotive, oil and gas, and pharmaceutical businesses to reduce its debt. In May, the company reached an agreement with the smart home company Savant to sell its iconic light-bulb business.
For more than a century, the lighting business has been GE's most well-known symbol. Edison invented the first commercial incandescent lamp in 1879, and subsequently formed the Edison General Electric Company. In 1892, this company merged with Houston Electric Company to become today's GE.
(Writing by Alex Guo Editing by Tammy Yang)
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