General Electric looking to sell GE Asset Management

General Electric Co. plans to explore opportunities to sell its money management arm, GE Asset Management, to another investment management firm, spokesman Chris Linehan said Thursday.

Although Mr. Linehan declined to name a list of potential buyers or a possible price range, he said the buyer universe will include only investment management firms that possess considerable experience managing retirement plan assets, scale and broad distribution capabilities.

The buyer also will be responsible for managing GEAM's third-party client asset base, subject to client consent.

GEAM had $115 billion in assets under management as of June 30, of which $17 billion was third-party assets.

It is expected that the buyer will acquire both GEAM's assets and team, with the exception of a small number of GEAM employees who will remain with GE to provide investment oversight of the company's primary benefit plans.

The decision to sell the asset management business is part of GE's plan to simplify its business platform.

An independent fiduciary will be appointed to review the transaction. The independent fiduciary will approve the asset manager that will be engaged to manage the assets related to GE's primary benefit plans, currently managed by GEAM, including the GE pension fund. GEAM also currently manages six of the defined contribution plan investment options, totaling $9.3 billion in plan assets as of Dec. 31. GE will retain responsibilities as plan sponsor and fiduciary for these plans after the sale.

Net sale proceeds from the transaction will be deposited into the GE Pension Trust.

The potential sale will not change the benefits received by participants in the GE pension fund — or any affiliate pension fund — and does not change GE's requirement to meet its pension funding obligations.

A buyer is expected to be selected early in the first quarter of 2016.

GE had $48.3 billion in defined benefit assets and liabilities of $70.7 billion as of Dec. 31, according to the company's latest 10-K filing. Its GE Savings and Security Program DC plan had about $26.5 billion in assets as of Dec. 31, according to its most recent 11-K filing.