The European Commission on Tuesday said it is still pursuing its normal review process in General Electric Co.‘s proposed $42 billion purchase of Honeywell Int’l Inc., despite comments by a top GE official that there was no chance of approval.

Alexander Schaub, the commission’s director general for competition, says the group was conducting “market testing,” in which it asks competitors and customers to quantify the effect on competition of combining the two companies. Schaub told Reuters news service the market testing, which should be complete this week, will help the commission reach a final decision. “We would not organize market tests without wishing to take them into account,” he says.

But, speaking to France’s Le Monde newspaper, GE President Jeffrey Immelt repeated GE’s view that the commission, the executive arm of the European Union, will reject the proposal, despite concessions offered by GE last week. Asked to rate the deal’s chances of survival, Immelt told Le Monde: “The percentage is zero. The offer is on the table but all the indications we have received from the European Commission make us think this offer will not be accepted.”

While GE has not withdrawn its application to the European Commission, analysts say relations with Honeywell—which has spent months preparing for the combination—were becoming caustic. A Honeywell spokesman on Tuesday reiterated the company’s position and announced in a statement on Monday that it remains committed to the deal and that it expects GE to “do everything possible to secure regulatory approval for the transaction.”

The next formal step is a June 25 meeting of the advisory committee, made up of representatives of the competition agencies of all 15 EU member states, to decide whether to recommend commission approval by July 12.

Shares of Honeywell closed down 3.8 percent, or $1.50, to $38.50—an indication in which investors saw hopes of the deal fading—while GE shares closed down 13 cents to $48.87.

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