GE to Sell Genworth Stock

General Electric, Fairfield, Conn., has announced that it will sell 82 million class A shares of the common stock of Genworth Financial, Richmond, Va.In addition, Genworth will purchase between $400 million and $500 million of class B common stock directly from GE. The sales will leave GE as the 51% share owner of Genworth, whose mortgage insurance subsidiary is headquartered in Raleigh, N.C. GE said the sale proceeds will be used to eliminate the "parent-supported" debt at its GE Capital unit and enable GE Capital to increase the dividend it pays to GE from 10% of its earnings to 40% starting in the second quarter. The global coordinator and bookrunner for the offering is Morgan Stanley, with J.P. Morgan and Merrill Lynch as joint lead managers and bookrunners. The initial public offering in May 2004 spun off 30% of Genworth to the public. As of 11 a.m. on March 7, the day the companies made the announcement, Genworth's shares were trading at $28.58, $0.17 down on the day, after opening at $0.50 down.