U.S. JUSTICE DEPARTMENT TENATIVELY CLEARS GE, HONEYWELL MERGER
FAIRFIELD, Conn., and MORRIS TOWNSHIP, N.J.
The General Electric Co. (GE) and Honeywell confirm that the United States Department of Justice (DOJ) has given conditional clearance for GE to acquire Honeywell in a tax-free merger valued at $43 billion. The transaction is expected to contribute double-digit accretion in the first full year post-close.
Following an extensive five-month investigation, the DOJ and both companies reached an agreement in principle under which the acquisition will be cleared subject to final negotiation and entry of a consent decree. GE and Honeywell accounted for approximately $155 billion in combined revenues in 2000.
“We are pleased with the DOJ’s action,” says John Welch Jr., chairman and CEO of GE. “Now that the Justice Department has completed its review of the transaction, we can focus on our continuing discussions with European commission officials. We remain positive about that process and hopeful that we can proceed promptly to a just conclusion. Honeywell is a great fit for GE—we look forward to completing the global clearance process, closing the deal, and getting to work on the integration of the Honeywell businesses into GE.”
Honeywell Chairman and CEO Michael Bonsignore adds, “We are very pleased with the agreement in principle we’ve reached with the Department of Justice. All of us at Honeywell are excited about the long-term shareowner value that will be created by the combination of our two companies.”
To achieve these gains, GE expects to apply its strategic growth initiatives of globalization, services and more to the Honeywell businesses to create new synergies and increase productivity post-close.
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