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Monti pledges stronger US ties after GE veto

Michael Harrison
Wednesday 04 July 2001 00:00 BST
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The European Competition Comissioner, Mario Monti, pledged yesterday to strengthen co-operation with anti-trust authorities in the US after formally vetoing General Electric's $42bn (£29.9bn) takeover of Honeywell.

Mr Monti said it was "unfortunate" that Brussels had decided to block the deal, the world's biggest industrial merger, when it had already been cleared by the US Justice Department. But he added: "GE-Honeywell is a rare case where the transatlantic competition authorities have disagreed. I am determined to strengthen our bilateral co-operation in the future to try and reduce this risk further."

The refusal of the companies to withdraw the merger, which led to a formal prohibition by Brussels, means that GE will now be on record as having a "dominant position" in the aeroengine market, which could compromise it in future deals.

Expectations are also growing that Honeywell's chief executive Robert Bonsignore could lose his job over the deal.

Mr Monti said the merger would have enabled GE and Honeywell to leverage their market power in engines and avionics: "The merger between GE and Honeywell, as it was notified, would have severely reduced competition in the aerospace industry and resulted ultimately in higher prices for customers."

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