Boeing Merger Sparks Meetings Between U.S., EU
U.S. antitrust officials said America’s national interests would be at stake if the European Union imposes onerous sanctions against Boeing Co.’s $15.5-billion acquisition of McDonnell Douglas Corp.
A special delegation of U.S. officials, led by Justice Department antitrust chief Joel Klein, met in Brussels on Sunday with European antitrust regulators who are still considering whether to reject the acquisition.
The EU cannot halt the merger. But it can levy fines in the billions of dollars on Seattle-based Boeing if it finds the takeover adversely affects free trade in Europe.
“We are here because the U.S. government is concerned about potential action in the European Union that could affect two major U.S. corporations and U.S. interests,” said Klein in an interview with Bloomberg News between meetings.
Boeing, which has until Tuesday to offer remedies that ease European concerns, also has been negotiating with regulators through the weekend, a European Commission official said.
On July 4, an EU advisory panel, composed of antitrust officials from each of the 15 European Union members, voted unanimously to recommend the merger be rejected because it would harm competition for commercial jetliners.
Several possible resolutions have been considered, according to people involved in the negotiations, including one in which Boeing would scrap agreements making it the exclusive jet supplier to AMR Corp.’s American Airlines, Delta Air Lines Inc. and Continental Airlines Inc. for the next 20 years. Another would have Boeing change its accounting practices to ensure the new company’s commercial aircraft operation doesn’t benefit unfairly from U.S. defense contracts. Talks also have included the possibility of Boeing trying to sell McDonnell Douglas’ commercial aircraft unit, Douglas Aircraft.
Europe’s merger task force plans to make formal recommendations for the 20-member commission by the end of the week, and the commission is scheduled to vote on the merger July 23.
