GE to sell fleet services to Element for $6.9bn

General Electric said Monday it had agreed to sell its vehicle fleet management and financing services in the United States and three other countries to Canadian firm Element Financial for $6.9 billion.

GE, which is restructuring to focus on its core industrial business, also said it had signed a preliminary agreement to sell its European fleet businesses to Arval, a subsidiary of French banking giant BNP Paribas and a partner of Element.

The announcement is the latest step in GE's plan to sharply pare back GE Capital in the wake of the 2008-2009 global financial crisis.

The transactions announced Monday would bring total GE Capital asset sales to $63 billion. The total could reach $100 billion by the end of the year, said Keith Sherin, GE Capital chairman and chief executive.

"We continue to demonstrate speed and execution on our strategy to sell most of the assets of GE Capital," Sherin said.

GE Capital Fleet Services provides fleet management services and commercial car and truck financing around the world for more than 1.5 million vehicles.

Element bought GE Capital's Canadian fleet business in 2013. The transaction announced on Monday includes the transfer of the employees, systems, offices and other assets required to operate the GE Capital businesses in the United States, Mexico, Australia and New Zealand.

Arval's planned purchase of the European fleet operations would expand the Element-Arval Global Alliance's management of customer fleets to more than 40 countries, the Toronto-based company said.

The US and Mexico transaction with Element is targeted to close in the third quarter of this year, followed by the Australia and New Zealand transaction in the fourth quarter, GE said.

GE and Arval will consult with their respective works councils about the European transaction. If approved, that deal could close in the fourth quarter.

Shares in Dow member GE tumbled 0.9 percent to $26.85 in opening trade amid a sharp Wall Street sell-off as Greece neared default on its debts and possibly an exit from the eurozone.