GE spins off Sychrnony Financial

Stamford, Conn. -- General Electric is spinning off its Synchrony Financial consumer credit business in an initial public offering (IPO) and seeking a market valuation as high as $22 billion. Synchrony offers store credit cards for retailers such as Wal-Mart Stores Inc. and J.C. Penney Co.



The company will be offering 125 million shares for $23 to $26 apiece according to a filing, which could raise more than $3 billion. The high end of that range is 11 times Synchrony’s 2013 earnings, placing it below the trading values of competing consumer credit companies such as Discover and American Express. Synchrony reported a purchase volume of $94 billion in 2013, making it the largest provider of private-label credit cards in the U.S.



GE will own 85% of Synchrony after the IPO. Remaining shares will be distributed to GE shareholders in a tax-free transaction scheduled for late 2015. Synchrony will list its shares on the New York Stock Exchange under the symbol SYF. Goldman Sachs Group Inc., JPMorgan Chase & Co., Citigroup Inc. and Morgan Stanley are managing the offering.