General Electric will split into three public companies, individually focusing on aviation, energy and healthcare, the company announced Tuesday.

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The change comes after years of attempting to reshape the American construction company and get out of debt, leading some to believe it could signal the end of the group companies as a whole.

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“It’s over now… in a digital economy, there’s no real place for it,” said Nick Heyman of William Blair, who has followed GE for years.

The company has changed dramatically since its launch in the 1980s, getting rid of products that are most famous for appliances and light bulbs made since the company’s inception.

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GE is looking to the future with its structural changes and expects to reduce its debt by the end of the year.

For more reporting from The Associated Press, see below:

Tuesday’s announcement marks the climax of efforts to split the empire built in the 1980s under Jack Welch, one of America’s first CEO “superstars.”

GE stock became one of the most sought-after stocks on Wall Street under Welch, regularly outperforming peers and the broader market. During the 1990s, it gave a return on investment of 1,120.6 percent. During Welch’s tenure, GE’s revenue grew nearly five-fold and the company’s value grew 30-fold.

Yet the stock began to lag in the summer of 2001, during the waning days of Welch’s rule. As the decade drew to a close, GE was nearly doomed with the arrival of the worst financial crisis since the Great Depression. General Electric’s weaknesses were exposed and the epicenter of the earthquake was the company’s financial arm, GE Capital.

Shares lost 80 percent of their value in the first few months of 2009 through early 2008 and have only recently begun to recover as the company unpacked a lot manufactured by Welch. The stock is up 30 percent this year as asset selling continues, and shares rose 6 percent in heavy trading on Tuesday to hit a new high for the year.

GE’s aviation arm, which is most profitable, will name General Electric. GE will spin off its healthcare business in early 2023 and its energy segment, including renewable energy, electricity and digital operations, in early 2024.

The decision to split into GE was well received on Tuesday in general markets and by those who pushed for change.

“The strategic logic is clear: three well-capitalized, industry-leading public companies, each with deeper operational focus and accountability, greater strategic flexibility and tailored capital allocation decisions,” said a large stakeholder whose founding partner served at GE. Yes, has written. Board.

Heyman said the group model no longer works in a market in which only the fast and agile survive.

Culp Healthcare will become the non-executive chairman of the company, with GE holding a 19.9 per cent stake in the unit. Peter Arduini will serve as President and CEO of GE Healthcare effective January 1, 2022. Scott Strazik will become CEO of the combined renewable energy, electricity and digital business. Culp will lead the aviation business with John Slattery as its CEO.

Culp achieved a major milestone in reshaping General Electric this year with a $30 billion deal to merge GE’s aircraft leasing business with AirCap Holdings of Ireland. Because the arrangement pushed GE Capital Aviation Services into a separate business, Culp essentially closed the books on GE Capital, the financial division that nearly sank the entire company during the 2008 financial crisis.

The company said Tuesday it expects operating costs of about $2 billion related to the divestiture, which will require board approval.

The Boston company also announced Tuesday that it expects to reduce its debt by more than $75 billion by the end of the year.

The question now is whether other groups will see their company structure as a relic of the past.

General Electric’s decision to disband an industrial bellwether, according to RBC Capital Markets, could trigger similar actions in other large conglomerates with “urges to disband.”

“GE’s announcement today could prompt the boards of several other multi-industry companies to move forward on more aggressive portfolio simplification steps, including Emerson, Roper Technologies and 3M,” wrote analysts at the firm.

Unlike GE, which continued to reduce assets this year, all three industrial groups have underperformed the S&P 500 in 2021.