Immelt spoke after GE said it would merge its oil and gas business with the oilfield services provider. GE would own 62.5 percent of the new company, and Baker Hughes shareholders would get a one-time cash dividend of $17.50 a share and a 37.5 percent share of the combined enterprise.
By midday, Baker Hughes' share prices were down 2.8 percent while GE's were up slightly.
"By this point I've seen every different kind of transaction. I think this gives us an opportunity to create all the synergies of a combined GE and Baker Hughes, which we think are substantial," Immelt said on "Squawk on the Street." "This was a tremendously creative kind of transaction to do right now in the cycle."
The deal would create the world's No. 2 oilfield services provider after Schlumberger. Baker Hughes had planned to merge with bigger rival Halliburton, but the transaction fell through in May due to opposition from regulators.
The deal comes as North American oil and gas producers are putting rigs back to work after a near freeze in activity because of low oil prices.
"If the pricing gets better it allows us to benefit from that as well," Immelt said.
—Reuters contributed to this report.