GE Healthcare is second-biggest S&P 500 decliner after pricing offering of 14 million shares

By Ciara Linnane

GE Healthcare upsized the secondary offering from 13 million shares previously

GE Healthcare Technologies Inc.'s stock fell 4% Wednesday and was second-biggest S&P 500 decliner after Dollar Tree Inc., after the company announced the pricing of an upsized secondary offering of shares.

The shares are being sold by Morgan Stanley Bank N.A., a unit of Morgan Stanley & Co. LLC and GE Healthcare will not receive any proceeds. The deal was upsized to 14 million shares from an earlier plan to offer 13 million shares.

Before the offer closes, General Electric Co. is expected to exchange the GEHC shares for debt held by Morgan Stanley Bank. Once the debt-for-equity exchange is completed, Morgan Stanley plans to sell the GEHC shares to the underwriter.

Morgan Stanley is sole book-running manager on the deal.

GE Healthcare (GEHC) was spun out of General Electric in January of 2023 and houses its medical device business.

Read now: GE Healthcare's stock on track for biggest gain since spinoff from GE after earnings beat

On Tuesday, the company said it's expanding its collaboration with Mass General Brigham and will integrate medical-imaging foundation models into its AI research work.

The partners announced a 10-year commitment in 2017 to explore the use of AI across a range of diagnostic and treatment paradigms.

"With foundation models, we are witnessing the next wave of AI innovation, and it is already reshaping how we build, integrate and use AI," said Dr. Keith Dreyer, chief data science officer at Mass General Brigham.

In February, GE Healthcare said it's participating in a project to pioneer an AI-screening platform for early detection of Alzheimer's disease. It also announced new data validating AI models for predicting patient response to immunotherapies. It made those disclosures while reporting fourth-quarter earnings.

General Electric (GE), meanwhile, is set for the long-planned spinoff of its power and renewable-energy businesses on April 2, which will leave the company with just its aerospace business.

On that date, the 150-year-old company, co-founded by Thomas Edison, will stop being GE and become GE Aerospace. The company, which will still have its stock traded on the New York Stock Exchange under the ticker symbol GE, will provide engines, components and systems for use in commercial and military aircraft.

GE Healthcare's stock has gained 15% in the last 12 months, while the S&P 500 SPX has gained 34%.

-Ciara Linnane

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03-13-24 1035ET

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