GE Healthcare Hires New General Counsel as it Prepares for Spinoff
GE Healthcare is the healthcare division of the industrial conglomerate General Electric. It has hired Frank Jimenez as its new general counsel. Mr. Jimenez was formerly general counsel of Raytheon Technologies. He is onboarding at a critical time for the company, as GE is preparing to spin off GE Healthcare from the main company. Following the spinoff transaction, GE Healthcare will become a public company.
Mr. Jimenez’s “proven leadership and significant experience in government and across industries” will be an asset to the organization during this critical transition period, stated Peter Arduini, the CEO of GE Healthcare.
While at Raytheon, Mr. Jimenez led the defense contractor’s legal and compliance functions. As a manufacturer of military weapons, commercial electronics, and cybersecurity solutions, Raytheon faced legal issues in a range of areas. Mr. Jimenez guided Raytheon through several major corporate transactions, experience that will be invaluable at GE Healthcare.
Prior to Mr. Jimenez’s move to GE Healthcare, Raytheon completed a merger of equals with the aerospace business of United Technologies Corporation. The deal created one of the largest aerospace and defense companies in the world. The merger produced a defense business that generated roughly $74 billion in revenues during 2019.
Former GC of US Navy
Early in his career, Mr. Jimenez was general counsel of the U.S. Navy during President George W. Bush’s second term. He supervised a legal department of over 600 attorneys across the globe and advised the Navy on a variety of legal areas including property law, environmental law, acquisitions, and legislative and ethical issues.
Mr. Jimenez grew up in Miami and earned degrees from Yale Law School and the University of Pennsylvania’s Wharton School of Business. He was chief of staff to Jeb Bush while he was governor of Florida and was also a candidate for a Florida Supreme Court seat.
The Business of GE Healthcare
GE Healthcare is a global medical technology and life sciences company. It is currently part of General Electric (GE), the nearly 130-year-old industrial conglomerate. The industrial giant also has major businesses in the aviation and energy sectors.
GE Healthcare’s business is divided into two segments: Healthcare Systems and Life Sciences. The Healthcare Systems segment develops diagnostic equipment such as ultrasound systems and medical imaging technology. The division also provides healthcare technology management systems and enterprise software solutions to improve the efficiency of healthcare delivery.
The Life Sciences division is focused on pharmaceutical diagnostics. For example, the Life Sciences division manufactures laboratory reagents and imaging agents to enhance the resolution of diagnostic imaging procedures. GE is a leading worldwide provider of pharmaceutical diagnostics for medical imaging.
In early 2020, GE sold off the BioPharma unit of GE Healthcare to Danaher, a science and technology conglomerate. This unit was previously part of GE Healthcare’s Life Sciences business. GE received approximately $20 billion for the sale. It comprised many of the top biologic therapies on the market, including 80% of global insulin drug production. Many materials that help pharmaceutical companies mass produce disease-fighting drugs are manufactured by the BioPharma division.
The Looming Spinoff from General Electric
The spinoff of GE’s healthcare unit is targeted for early 2023. GE intends to retain a 19.9% stake in GE Healthcare. This amount is below 20% for tax purposes.
GE is pitching the spinoff as strategic for both businesses. By making GE Healthcare an independent, publicly traded company, the belief is that it will be able to focus on industry-specific opportunities and healthcare innovation.
“As a standalone company, GE Healthcare will be even better positioned to invest both organically and inorganically to drive faster growth,” stated Larry Culp, Chairman and CEO of General Electric.
This move is part of a larger plan to eventually separate General Electric into three separate divisions. In 2024, after the GE Healthcare spinoff concludes, General Electric plans to combine its renewable energy and power businesses and then spin them off.
Once both transactions conclude in early 2024, General Electric will bring its attention to aviation. GE Aviation is a division of GE that designs and produces commercial and military aircraft engines and other aircraft parts.