Competition panel backs Brussels on GE-Honeywell veto
An advisory committee of European competition experts yesterday backed Mario Monti's decision to reject General Electric's $41bn takeover of its US rival Honeywell, which appears certain to be blocked officially by Brussels early next month.
Reports that the committee had split and called on the commission to re-enter talks with GE sent Honeywell's stock up in early New York trading, as hopes grew that the merger could be revived. These reports were later dismissed by sources close to the Commission, who said that the competition commissioner, Mario Monti, had been backed by the committee, with only one small country abstaining.
The advisory committee, which is made up of representatives from the competition agencies of member states, reviews conclusions made by the European Commission on big merger deals, although its recommendations are not binding on the Commission.
GE representatives were not involved in the meeting, although they have met with some competition officials in EU capitals in recent days to explain and defend their proposed concessions, GE's spokeswoman Louise Binns said.
The EU's hard line on the GE-Honeywell tie-up, which won conditional US clearance last month, has provoked criticism from the Bush administration and Congress.
A US senator, Jay Rockefeller of West Virginia, sent a letter last week to the Commission to urge a fair decision and warn that a rejection "could have a chilling effect on future transatlantic aviation and aerospace cooperation".
Mr Monti responded that the decision would not be swayed by attempts at "political intervention".
In its last attempt to meet EU objections, GE said that it had offered to divest Honeywell units with $2.2bn (£1.6bn) in annual sales but that the Commission demanded billions more.
But Mr Monti said GE could have kept some of the Honeywell units it was offering to sell if it had agreed to "a structural commitment to modify the commercial behavior of" GE's aircraft leasing unit, GE Capital Aviation Services.
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