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GE's Welch tries to deal
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June 13, 2001: 4:26 p.m. ET
Welch met with EC's Monti twice to seek OK of $40B Honeywell takeover
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NEW YORK (CNNfn) - General Electric Co. CEO Jack Welch met with European Competition Commission Mario Monti twice Wednesday in his attempt to win approval of GE's $41 billion takeover bid of Honeywell International Corp.
Conflicting reports emerged Wednesday. At one point, Reuters reported that talks between the two sides did not go well and that Welch told a U.S. government official that the sides were "miles apart. Welch also told the U.S. official to not involve President Bush, who was in Brussels as part of a European tour, because it would do little good.
A later story from Reuters said the morning meeting between Welch and Monti had made progress. The source cited in the later report expressed surprise that Welch had characterized the meeting in a pessimistic light.
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Jack Welch
GE CEO and Chairman | |
GE declined to comment on the outcome of the meeting and confirmed only that the second encounter had ended by 3:30 p.m. ET.
GE has until June 14 to meet its deadline "to propose its undertaking" to the EC, a person familiar with the situation told CNNfn.com.
GE offered to make more divestitures Wednesday in its bid to gain EC approval. On top of earlier proposals, GE proposed selling $2.1 billion in assets which included Honeywell units making ground-proximity warning systems, some collision-avoidance systems, and also one of Honeywell's aircraft-maintenance facilities in Germany, the Wall Street Journal reported.
Reuters said the concession includes the sale of Honeywell's regional jet engine business and a chunk of its avionics business.
The $40 billion merger of GE and Honeywell will create a near-monopoly on engines for large regional jets, press reports have said.
Fairfield, Conn.-based GE also proposed separating the accounts and management of GE Capital Aviation Services (GECAS), its aircraft leasing arm, the Journal said. GECAS buys, sells and leases airplanes. The EC has expressed concern that GE could use GECAS to help it compete unfairly against other firms.
GE said it was not the source of this report and would not comment on its negotiations with the European regulators.
GE (GE: down $0.92 to $47.85, Research, Estimates) shares dropped nearly two percent Wednesday. 
-- from staff and wire reports
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