General Electric Co., which has been under pressure from activist investor Trian Fund Management LP to cut costs and improve its stock performance, has elected a founding partner of Trian to replace a longtime board member.
Ed Garden, Trian's chief investment officer, will replace former Deere & Co. CEO Robert Lane, who is retiring from GE's board after 12 years, the company said Monday.
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The change comes a day before Procter & Gamble Co. shareholders decide whether to elect Trian's Nelson Peltz to the consumer-product giant's board in the most expensive proxy fight ever.
Mr. Garden said in prepared remarks that although he is disappointed by the performance of GE's stock, which is down 23% this year, he sees the company as a long-term investment with "significant upside."
Trian became a GE shareholder in 2015 and holds a 0.82% stake in the company. While the investment was originally friendly and Trian didn't ask for a board seat, Trian has become more aggressive as GE shares have fallen and costs haven't come down as quickly as desired.
Trian has been supportive of GE's new CEO John Flannery, who took over in August and has been implementing a turnaround plan at the industrial conglomerate.
The company announced last week that three top executives, including GE's chief financial officer, were leaving the company. All were top lieutenants to former CEO Jeff Immelt, who stepped aside in August and resigned as chairman last week, three months ahead of schedule.
GE shares are down 0.4% in premarket trading Monday.
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(END) Dow Jones Newswires
October 09, 2017 07:55 ET (11:55 GMT)