"H. Lawrence Culp, Jr. has been named Chairman and Chief Executive Officer of the Company by a unanimous vote of the GE Board of Directors," the announcement this morning reads.
As of 8:30 a.m. in New York, GE shares are rising 15% on the news.
Flannery's removal comes shortly after his one-year anniversary in the CEO position, taking over then for his predecessor Jeffrey Immelt.
The replacement and stock surge coincides with the announcement that GE expects to take an approximately $23 billion charge related its GE Power business.
"I think if you do a deep read through these are related items," William Blair & Company equity research associate Tanner James told Real Money.
He explained that Flannery was much maligned at the end of his tenure at the 126-year-old, Boston-based industrial standby, but that his spinoff aspirations may have been the key disagreement.
"I think the board disapproved of the way he was breaking up the company and this charge might even mean they are going to sell this unit," James said. "Under Flannery, GE Power would have been core."
Book-ended by the announced charge to the power unit and an expected shortfall of previously indicated guidance for free cash flow and earnings per share this year, Flannery's tenure at GE has been a tumultuous one.
The shares have languished under his leadership. On his first day in office, the stock opened at $25.63 per share. It closed at just $11.29 per share last Friday.
Under his watch the company was also removed from the Dow Jones Industrial Average, a removal that came after over 100 years as a marquee name in the average.
In early 2018 the company also reported a staggering $31 billion pension shortfall causing analysts to call the balance sheet "a mess" under his leadership.
To be sure, the lion's share of the pension problem came under the leadership of Immelt, who actually inherited a pension surplus. That was quickly turned around into a severe deficit after 2008.
Flannery's solution was far from perfect. He elected to take out multi-billion-dollar loans in order to shore up this issue in the near term, essentially adding debt on top of its massive shortfall.
In order to try to solve these issues, Flannery sought a plan to spin off its healthcare business in order to focus on its renewable energy business, GE Power, and aviation.
The spinoff selection may have been the proverbial straw to break the camel's back in his tumultuous tenure.
Man for the Job
James was confident in Culp's capable hands taking over GE, which appears to be reflected in the market's reaction.
According to the Harvard Business School, where Culp is a senior lecturer on business administration, during Culp's tenure as president of Danaher from 2000 to 2014, he helped the company "increase revenues and its market capitalization five-fold to $20 billion and $50 billion, respectively."
The school also ranked him one of the top 50 CEOs in the world during his time there.
William Blair's James said the news sounds like perfect timing for GE.
"I think that Culp is a fantastic operator," he said. "It's definitely an opportunity to upgrade when they need it."
Culp will need to move swiftly as he takes over from Flannery with little notice and acknowledged that responsibility in a company press release.
"We will be working very hard in the coming weeks to drive superior execution, and we will move with urgency," Culp said. "We remain committed to strengthening the balance sheet including deleveraging."
Real Money will keep a close eye on the urgent movements Culp makes as he settles into his new role.
This story is developing