Trian investment in GE was ‘validation capital’: Nelson Peltz's right-hand man

Trian Fund Management's $2.5 billion investment in General Electric has bolstered investor confidence in the industrial giant's restructuring, Trian president and founding partner Peter May said Thursday.

GE has sold off much of its financial services arm since announcing a restructuring in April 2015 aimed at focusing the company on its industrial businesses such as aircraft engines, medical equipment and power generation.

"In the case of GE, we consider ourselves validation capital," May told CNBC's "Squawk Box."

"What happened with GE is they made the announcement that they're getting out of credit, and everybody basically kind of yawned because they felt management's been talking about a lot of those things for a long time," he said.

Trian's involvement with GE has lent credibility to the company's pivot and sent the message that engaged shareholders will hold management accountable for achieving its goals, May said.

Shares of GE are up about 18 percent since Nelson Peltz's Trian revealed its stake in GE last October.

While consensus estimates among analysts see upside for GE shares, some doubt the stock can move substantially higher. This week, Cowen initiated coverage of GE with a market perform rating and a price target of $29, below the stock's roughly $30 price at the time the report was issued.

May on Thursday reiterated Trian's position that GE's industrial businesses are some of the most valuable in the world.

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