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EU Business Law

This presentation includes General Electric & Honeywell Merger, therefore conclusions of US and EU.

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EU Business Law

  1. 1. CASE COMP/M.2220 GENERAL ELECTRIC/HONEYWELL Yılmaz Yamaç EU Business Law
  2. 2. Regards Having regard to - the Treaty establishing the European Community - the Agreement on the European Economic Area - the opinion of the Advisory Committee on Concentrations
  3. 3.  On 5 February 2001, the Commission received the notification of a proposed concentration pursuant to Article 4 of Regulation (EEC) No 4064/89  On 1 March 2001, the Commission decided in accordance with Article 6(1)(c) of the Merger Regulation and Article 47 of the EEA Agreement to initiate proceedings in this case.
  4. 4. Parties General Electric, is an American multinational conglomerate corporation incorporated in New York and headquartered in Connecticut in the United States. Honeywell International is an American multinational conglomerate company
  5. 5. The Operation  “General Electric 2000 Merger Sub, Inc.”  As a result, Honeywell will become a wholly owned subsidiary of GE.
  6. 6. Concentration  GE will exchange shares of GE stock for each outstanding share of Honeywell stock.  All shares of Honeywell common stock will be cancelled, retired and cease to exist.  As a result of this acquisition, GE will acquire sole control of Honeywell giving rise to a concentration within the meaning of Article 3(1)(b) of the Merger Regulation.
  7. 7. Conclusion – The US Side  In the US, proposed mergers are reported to the Antitrust Division of the Department of Justice (DOJ).  The DOJ typically focuses on horizontal dimensions of mergers.  In this merger, the DOJ approved it with minor changes on 2. May, 2001
  8. 8.  The EC based formally its decision to block the merger on two pillars  The strengthening of the GE dominant position  The creation of a dominant position  European Commission had taken an active interest in merger review Conclusion – The EU Side
  9. 9.  After several observation and meeting EC has made desicion: Combined GE/Honeywell would be a major player in aircraft engines. Conclusion – The EU Side
  10. 10.  The proposed merger incompatible with the common market pursuant to Article 8(3) of the Merger Regulation.  The concentration by which GE Company acquires control of the undertaking Honeywell is declared incompatible with the common market and with the EEA Agreement. Conclusion – The EU Side
  11. 11.  Thanks for your attention