(Reuters) - General Electric Co (GE.N) took a big step on Tuesday in its plan to unload most of its financing operations, saying it has agreed to sell commercial lending and leasing businesses worth more than $30 billion to Wells Fargo & Co (WFC.N).
The U.S. conglomerate has now inked $126 billion in transactions -- more than half of its overall target -- since announcing in April it would seek to reduce its GE Capital financing business to less than 10 percent of earnings as it focuses more on industrial manufacturing. GE Capital accounted for 42 percent of the company's profit in 2014.
Only one remaining significant GE Capital business in the United States remains: its franchise finance unit, which has about $5.5 billion worth of assets.
The ability to move fast on its U.S. transactions is critical because once those deals close, GE plans to apply to shed GE Capital's regulatory designation as a Systemically Important Financial Institution, or SIFI, a label it gained after the 2008 financial crisis.
The sale to Wells, the price of which was not disclosed, involves three lines of business: commercial distribution finance, vendor finance and corporate finance.
Commercial distribution finance offers lending to dealers and manufacturers of durable goods, such as boats, recreational vehicles and off-road vehicles. Vendor finance involves dealer networks for commercial equipment such as copiers, materials handling and construction machines.
Corporate finance includes asset-based loans and equipment leasing to a range of mid-size and larger companies.
About 3,000 GE employees of the 3,500 in those businesses will shift to Wells through the deal, GE said.
The transaction is expected to be completed in the first quarter of 2016, GE said.
Reuters first reported last week that GE was nearing a deal to sell the massive portfolio of loans to Wells.
Goldman Sachs and Credit Suisse advised GE on the deal.
Reporting by Lewis Krauskopf in New York and Ankit Ajmera in Bengaluru; Editing by Don Sebastian and Alan Crosby