First and foremost, as I write this from my home “office” like many of you, I hope you and your families are staying healthy and safe during this difficult and unprecedented time around the world. The daily flow of information and pace of activity across our markets, businesses and communities impacting our employees, customers, and investors have been dynamic and humbling to say the least, but I wanted to pause for a moment to share a handful of updates.
Yesterday we announced that Danaher completed the acquisition of GE’s BioPharma business for approximately $20 billion of net proceeds. Our CEO Larry Culp said, “Completing the sale of BioPharma represents a critical milestone on our multi-year transformation, fortifying our considerable sources to de-risk our balance sheet and continue to solidify our financial position. I am proud of the teams for completing this transaction amidst a great deal of global change. As we go forward, GE retains one of the world’s leading healthcare companies, using our global scale and technical leadership to deliver better outcomes and more capacity to a world striving for Precision Health.”
While our financial position is sound, each of our businesses are being impacted by the continuing evolution of the COVID-19 pandemic. Supply and demand dynamics in the industries where GE operates are shifting on a daily basis which requires that we take decisive actions based on the information at hand and continually adapt our operations to meet the needs of our customers.
Our airline and airframer customers are feeling the impact of this global pandemic acutely. Last week, Aviation announced several difficult but necessary actions to aggressively mitigate the impact of the pandemic. Aviation announced a temporary lack of work for some U.S. sites, eliminating some jobs, and other actions – all in addition to the hiring freeze, drastic reduction of non-essential spending, and merit increase cuts that were already in place. We expect these cost and cash actions will preserve $500 million to $1 billion in 2020. Culp also shared that for the remainder of 2020, he will forgo his full salary and David Joyce, CEO of GE Aviation, will forgo half of his salary.
The Healthcare team is rising to the challenge of the COVID-19 pandemic and taking swift action to support our customers and be part of the solution. We have increased production capacity to deliver critical equipment – such as ventilators – to customers around the world, and have partnered with Ford to scale that even further. Our field service engineers are on the front lines servicing equipment to ensure availability. And there are numerous examples of our current and former employees going above and beyond to make a positive difference.
Finally, our Power and Renewable Energy businesses remain focused on delivering critical equipment and services to meet global energy demand. On Monday, GE Power announced an order for two 9HA.01 gas turbines, two steam turbines, two generators and two heat recovery steam generators that will deliver world-class efficiency and flexibility for PGE’s Dolna Odra Plant in Poland. This 1.4 gigawatt plant will produce the equivalent electricity needed to power approximately 1 million Polish households while meeting rigorous environmental standards for emissions. Both businesses continue to adapt to address the impact of COVID-19 on asset utilization, supply chain dynamics, and project execution, and this deal serves as just one example that our teams can continue to deliver in the face of uncertainty.
Our primary focus remains on protecting the safety of our employees, continuing to serve our customers during their critical time of need, and preserving the strength of our businesses. I remain motivated and encouraged by the grit, resilience and commitment of the GE businesses during this difficult time and am proud of the work our colleagues are doing to support the global effort to fight COVID-19. You can read more about our efforts across the company and in our communities here. As always, I welcome your feedback and wish you good health.
Thank you for your continued interest in GE.