Goldman Sachs has been retained to help evaluate strategic options for GE-owned lessor GECAS, three sources confirm.
Once the largest lessor in the world, GECAS has for many years been rumoured to be up for sale. During 2017, one banker told FlightGlobal that GE had approached their firm seeking possible sale solutions, but no bank was chosen for the task at the time, FlightGlobal understands.
On 20 July, GE chief executive John Flannery told investors: "We are materially shrinking the size of GE Capital with planned asset reductions of $25 billion over the next two years."
This could include a sale of GECAS, which has a portfolio value of $23.6 billion today, according to FlightGlobal values data.
GECAS, which was established to provide support to the engine manufacturing arm of GE, lost access to cheap capital when its parent sold its bank, making it more expensive to finance the lessor's operations and capital expenditures.
In April 2015, GE announced the GE Capital Exit Plan.
GE Capital has shrunk by nearly 73% over the course of three-and-a-half years, from $500 billion at the end of 2014 to $136 billion in the second quarter of 2018, as assets were sold off.
GECAS itself has shrunk its commercial aircraft portfolio value by 31% during the past five-and-a-half years, FlightGlobal values data indicates. At the end of 2012, the company had a portfolio value of $34.1 billion, while today it is worth $23.6 billion.
Goldman Sachs did not respond to requests for comment. GECAS declined to comment.
Source: Cirium Dashboard