U.S. Markets closed

Fidelity, T. Rowe Bulked Up on GE Shares as Culp Took Over

Miles Weiss

(Bloomberg) -- When it comes to General Electric Co., two of the nation’s largest mutual fund companies have been going all in on the industrial conglomerate’s latest chief executive, Larry Culp.

Fidelity Investments and T. Rowe Price Group Inc. have bulked up on GE stock since Culp was named in October 2018. While neither fund company had much of a stake in GE before he took the helm, the two now rank as its second- and fourth-largest institutional shareholders, respectively, according to regulatory data compiled by Bloomberg.

Fidelity, based in Boston, actually began raising its stake in GE during the second quarter of last year, filings show, and by the end of September 2018 the firm held 187 million shares. That figure jumped to 301.4 million shares in the quarter ended December 2018. By the end of June, that stake had risen to 548.7 million shares.

At the end of last September, funds run by Baltimore-based T. Rowe Price held 30.8 million GE shares, according to Form 13Fs filed with the U.S. Securities and Exchange Commission. Their combined stake soared to 235.6 million shares during the ensuing quarter, and by June 30 had reached 365.6 million shares.

Culp, 56, is a renowned turnaround expert who won Wall Street’s praise for transforming manufacturer Danaher Corp., where he served as CEO from 2001 until 2014. Danaher’s share price rose an average of 14% annually during Culp’s tenure, compared to just 5.5% for the S&P 500, as he grew the company through $22 billion in acquisitions.

As Danaher’s two largest shareholders from 2006 through 2015, T. Rowe and Fidelity benefited from Culp’s leadership of the company; Fidelity at one point held an 18% stake in the company. Culp left Danaher in September 2014 and was named to T. Rowe Price’s board about one year later. He continued as a director at the mutual fund company until he took the top job at GE.

(Adds details on Culp’s record at Danaher Corp. in two final paragraphs.)

To contact the reporter on this story: Miles Weiss in Washington at mweiss@bloomberg.net

To contact the editors responsible for this story: Alan Mirabella at amirabella@bloomberg.net, Melissa Karsh

For more articles like this, please visit us at bloomberg.com

©2019 Bloomberg L.P.