By Dana Cimilluca, Dana Mattioli and Thomas Gryta
General Electric Co. is seeking a buyer for key parts of its digital business as the beleaguered industrial conglomerate unwinds a signature initiative of former Chief Executive Jeff Immelt amid a broader retrenchment.
The Boston-based company has hired an investment bank to run an auction for the operations, which GE has poured billions of dollars into, according to people familiar with the matter. It's not clear what exactly is for sale and how much a deal could generate, should there be one.
While the process is at an early stage, possible buyers include software companies and other industrial players seeking to become more digital-focused, one of the people said.
GE Digital, a much-touted software unit headquartered in San Ramon, Calif., was key to the strategy of Mr. Immelt, who left last summer. As part of an effort to reorient itself away from financial and media assets and bolster a sluggish stock price, the company built a software platform called Predix that aimed to help industrial customers like utilities and airlines gather and analyze data to better manage their equipment and wring out greater efficiencies.
GE Digital was established as a standalone unit in 2015 to distinguish it from the company's industrial divisions. In the fall of 2016, GE paid $915 million to acquire ServiceMax, a Pleasanton, Calif., company that makes apps for inventory management and workforce scheduling. Executives predicted at the time that GE would hit $15 billion in software sales by 2020 with half of that coming from providing Predix applications to the electricity industry.
GE said the business had revenue of $4 billion last year, up 12% from 2016. Not all of that would go to a buyer as the company is expected to continue providing software and services to its aviation and power customers.