Concretely, General Electric will give way to three separate listed groups, dedicated respectively to aviation, health and energy, just like Toshiba, which will create two new companies in addition to its existing structure.

Johnson & Johnson will separate its consumer products (Tylenol aspirin or Band-Aid dressings in particular) from the rest of the company, mainly medical equipment and prescription drugs including vaccines, to make it a new listed entity.

"This illustrates a trend which has been at work for more than twenty years and which pushes companies to focus on a single market", analyzes Michael Useem, professor at Wharton University and specialist in industrial restructuring.

For him, this series of announcements "will underline the fact that the diversified conglomerate, even if it occupied a huge place in American economic history, is on the verge of extinction."

Last week DuPont, which had already become independent again after the 2019 split from the giant Dow Dupont, also announced a strategic shift and the group's exit from a portfolio of industrial products.

For Gregori Volokhine, portfolio manager at Meeschaert Financial Services, for GE, as for IBM, which last week floated Kyndryl, specializing in the management of corporate IT infrastructures, deconstruction is an opportunity to separate the wheat from the tares.

"For a very long time, General Electric always had a little black sheep" among its activities, in this case energy recently, after being weighed down by financial services after the 2008 crisis.

Consequently, "all the other branches suffered from it", in terms of their stock market valuation but "also of the allocation" of resources between the various activities of the group.

By extension, many of these old conglomerates see their stock market prices dragging on, argues Michael Useem, weighed down by a sort of diversification penalty.

Analysts and investors sometimes find it difficult to grasp the group in its complexity and "assess its future results," he said.

In addition, it is better to split up of its own accord, with the control of its strategy, "rather than being pushed to do so by activist shareholders", argues Gregori Volokhine.

Conglomerates 2.0

But not all self-carving conglomerates are suffering.

"J&J is a great company," recalls Jim Osman, director of The Edge and specialist in "spin-offs" (part of a whole is separate from the rest).

"There is no good and bad activity" within the group, he insists.

"There are two beautiful branches that they think can shine on their own."

For him, the sequence is linked to the evolution of Wall Street, which has been flying from record to record since the beginning of the year.

Toshiba headquarters in Tokyo Kazuhiro NOGI AFP

"Companies try to create value with spin-offs when you are near highs on the stock market," he says.

"This is normal. You can no longer derive growth" from the share price without upsetting the very structure of the company.

Even if the examples have multiplied recently, the split is not inevitable, says Howard Yu, professor at the IMD school in Lausanne.

Certain old conglomerates, such as the American Honeywell, are thus well positioned and popular with investors.

For the academic, the latter was able, unlike GE, to take the turn of digitization, collection and use of data, as did the new conglomerates of the 21st century, Amazon or the Chinese Alibaba. .

Amazon may well be present in the cloud, grocery stores, online commerce and content (videos and audio), areas that are a priori different, it sees there, and investors with it, "the benefit of complementarity , which strengthens every piece of the ecosystem, "said Howard Yu." There's that digital glue "that keeps it all together.

But for Michael Useem, the markets could, on the contrary, soon ask the tech giants, Amazon or Google (Alphabet) in the lead, to split, for lack of readability.

"Waymo, it could perhaps be valued at 100 billion dollars," says Gregori Volokhine, about the subsidiary of autonomous vehicles of Alphabet.

"Even for Google, it's a lot of money."

© 2021 AFP