E*trade Financial Corp. today (Aug. 16) announced that it has agreed to sell its recreational vehicle and marine lending business to a unit of General Electric Co. for $60 million in cash.
According to a press release, E*trade Financial expects to record a pre-tax gain of approximately $45 million upon closing.
Under the terms of the sale, $3.3 billion in RV and marine assets will remain the property and continue to be serviced by E*trade Financial under GE Consumer Finance’s ownership. In addition, E*trade Financial will retain all assets originated through the transaction closing.
“We continuously review all aspects of the business to ensure all initiatives are core to the Company’s long-term vision,” said E*trade CEO Mitchell Caplan. “We believe our customers and shareholders are best served by deploying capital in a manner that accelerates the realization of that vision.”
“The sale of the consumer finance business allows us to further streamline our business and allows us greater focus in generating the value that is inherent in our business model,” said Jarrett Lilien, E*trade president and COO. “Maximizing opportunities for our retail customers to engage directly with us to meet their investing, cash and credit needs will yield the highest return for customers as well as shareholders.”
The deal is subject to approval by all regulatory agencies. Following the completion of the sale, GE Consumer Finance’s Retail Sales Finance division will re-brand E*trade Consumer Finance Corporation. Operations will continue to be based in Irvine, Calif. and Clearwater, Fla.