GE Bonus Plan Could Encourage Deal-Making

New incentive pay plan gives Immelt motive to tap NBC cash for deals.

General Electric Co.’s new incentive pay plan gives Chief Executive Officer Jeffrey Immelt motive to tap $16.7 billion from last month’s sale of the rest of NBC to fund industrial acquisitions.

The three-year program will pay Immelt in part for increasing the share of GE’s profit from manufacturing businesses, the company said last week in a Securities and Exchange Commission filing. It replaces an arrangement from 2010 to 2012 that rewarded his success in shrinking the finance unit.

Consumer Lending

The new compensation plan gives Immelt incentive to further shrink the finance unit, perhaps by separating the private-label credit card business, and to make acquisitions to fortify the industrial divisions, said Steven Winoker, a Sanford C. Bernstein & Co. analyst in New York, who has a market-perform rating on GE stock.

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