EU Committee Rejects GE-Honeywell Deal

A key European Union advisory committee voted to reject General Electric Co.’s proposed $42-billion purchase of Honeywell International Inc., supporting the recommendation of an expert panel, sources said.

But in a glimmer of hope for the deal, sources said the vote contained conditions that would require the European Commission to first restart negotiations with GE. Sources said 14 of the 15 European Union member nations attending the meeting had voted against the merger, but the sources differed on whether the final vote included conditions.

The committee recommendation next moves to European Competition Commissioner Mario Monti, who will consider it before going to his fellow commissioners next month. They are to vote on Monti’s recommendation by July 12.

GE shares fell $1.61 to $50.25, while Honeywell fell $1 to $35.60, both on the NYSE.