GE Capital's attempts to gain control of GE SeaCo thwarted

GE CAPITAL has failed in its bid to gain control of the other half of container leasing firm, GE SeaCo SRL, according to The Stamford Advocate.

This comes as Sea Containers Ltd, the other co-owner of the box leasing firm, won an arbitration case launched by GE Capital.

GE Capital had contended that a decision by Sea Container's founder, James Sherwood, to resign from his post as chairman of the board of directors in March 2006 had allowed GE to buy out Sea Container's interests in the leasing company. Arbitrators disagreed with GE's argument and ruled in favour of Sea Containers.

"We're disappointed by the decision," said David Frail, spokesman for GE's Equipment Services division in the report. "It's important to understand that the decision has no impact on GE SeaCo, the ownership situation or the majority that GE holds on the GE SeaCo board of directors."

The report said GE has a 5-4 majority on the board of GE SeaCo, which was established in 1998 as a joint venture to manage and operate the shipping container businesses of Sea Containers and GE Capital.

Sea Containers filed for bankruptcy in October 2006, however, GE SeaCo has continued to operate as a self-funded business.

"The favourable arbitration ruling is a major step forward in Sea Containers' efforts to advance its financial reorganisation," said Sea Containers' spokesman Adrian Flook in a statement. He added in the report that Sea Containers is keen to maintain its working relationship with GE Capital to "maximise the value" of their joint-venture, GE SeaCo.