GE Energy Financial Services

1
GE Energy Financial Services

• Mergers Acquisitions 
• What CIOs Should Know
• Sigal Zarmi
• April 19, 2007

2
Agenda

• Background
• Why MA
• What CIOs should do
• Lessons learned

3
GE - the right mix for growth
Energy Financial Services

• GE Key Facts/Honors
• Founded by Thomas Edison in 1878 as the Edison
  Electric Co.
• Only company still listed in Dow Jones Industrial
  Index since 1896
• 6 global businesses operating in more than 100
  countries
• 315,000 employees worldwide
• 163 billion in revenues, 2006
• AAA Rated
• Worlds Most Respected Company (1999-2005)
  Financial Times
• Global Most Admired Company (2006/2007) Fortune
  Magazine

GE Infrastructure
Energy
GE Industrial
Water
GE Commercial Finance
Oil Gas
GE Consumer Finance
Rail
GE Healthcare
Aircraft Engines
NBC Universal
Commercial Aviation Services (GECAS)
4
GE Energy Financial Services strengths
14B Assets
Deal size 25MM - 1B
Double-digit growth
Investing globally, across the capital spectrum
in the energy and water industries, to help our
customers and GE grow
30 year track record in energy finance GEs
100 years in energy
GEs AAA rating - funding cost advantage
330 energy experts 6 commercial teams
5
Industry, product, and global diversity
SolarPortugal
PipelinesUS
Power GenerationUS

• Serpa Solar Project
• 75 MM
• Worlds largest solar PV plant
• Acquisition Financing

• Southern Star
• Spans more than 6,000 miles in the Midwest and
  TX60 Equity Interest

• Linden Power Plant
• 900 MW power plant in NJ
• Acquisition Financing

OG/Debt FinanceCanada
Power GenerationIreland
WaterFrance

• Trinidad Drilling
• 430 MM
• Debt Financing

• Tynagh Power Plant
• 385MW CCGT power plant with GE technology
• Acquisition Financing

• IDEX Investment in industrial water treatment
  assets
• 95 Equity Interest

6
Total GE acquisitions and divestitures
in MMs
Year Acquisitions
Divestitures 2001 19,043.7 5,097.3
2002 17,488.4 1,631.1 2003 28,828.3
4,634.3 2004 14,515.1 1,685.3
2005 14,682.2 11,484.8 2006 15,087.2
9,267.5 2007 18,919.2 2,145.3
Total 128,564.10 35,945.60
Year to date April 16th
7
Why Mergers Acquisitions?
It is all about Growth!!
8
Why Mergers Acquisitions?

• Increase market share Consumer Finance JC Penney

• Quick entry to new markets GE Water

• Quick entry to new products GE Wind

• Adjacencies expansion NBC Universal

• Investment opportunities EFS Linden

9
Why CIO involvement?

• Part of growth
• Strengthen executive relationships
• Closer to revenue generation
• Breadth and depth of process understanding
• Leg up on integration

10
People

• Vision
• Values
• Knowledge/ Experience
• Organization
• Leaders
• Retention

11
Process

• Communication
• Decision making
• Customers and suppliers
• Product development
• Sales and marketing
• Operations
• Compliance, regulatory, controllership
• Functional areas Legal, Human Resource,
  Finance, Tax

12
Technology

• Infrastructure network, servers, security,
  helpdesk, telecom, services, email
• Applications enterprise, desktop
• Processes PMO, change management, development
• Support Keep the lights on, program
• Migration
• Intellectual property, patents

13
Skills for effectiveness
Acquisitions are more about cultural integration
than anything else
14
What to do first?

• Appoint an Integration Leader who has done it
  before
• Create communication plan employees, customers,
  suppliers, shareholders, media.
• Reassure employees/customers
• Assess key players
• Create detailed functional integration plan
• Identify measurements for success

15
Lessons learned

• Ask yourself before acquiring
• Why is the business better off because we own it?
• What is the essence of the integration?
• What success would look like?
• Define the Non-Negotiable

16
More lessons learned

• Align integration process with acquisition
  process
• Appoint a steering committee with senior leaders
• Appoint full-time resources on both sides
• Enforce senior leaders participation in major
  tollgates
• Use a repeatable process do not recreate the
  wheel

17
What does success look like?
18
Contact
Sigal Zarmi GE Energy Financial
Services Managing Director Chief Operating
Officer 120 Long Ridge Road, Stamford CT
06927 Phone [phone] Fax 203
357-4386 Email Sigal.Zarmi_at_ge.com www.geenergy
financialservices.com