1. GE/Honeywell Nederlandse Vereniging Mededingingsrecht

2. “The cleanest deal you ever saw” … and the largest industrial merger ever. Some of HON’s products (avionics, non-avionics) were complementary to some of GE’s products (aircraft engines), and sold to the same customers (airframers, airlines, leasing companies). GE competed with HON in only a few niches … worth about 1% of HON’s business. What was it all about ?

3. Why did the Commission block it ? Bundling: Commission feared GE would “bundle” HON’s products with GE’s engines. Customers would prefer the GE/HON bundle to competitors’ offerings (because the bundle would be less expensive). Rivals would be unable to compete against GE/HON, would become marginalized, and quit the market … At that point, GE/HON could raise prices. Financial strength: GE had financial strength that none of its rivals could match. This strength (expressed via GECAS and through other means) would give GE such a grip on the market, that it could exclude its rivals. “GE Capital is part of the arsenal for GE’s industrial side to beat the competition” (Fortune Magazine, November 1997, posted on GE’s homepage). Strengthening of dominance: GE was already dominant in aircraft engines (the combined GE/CFMI share is above 50%) and the practices described above would strengthen that dominance, and convert HON’s leading positions to dominance. Vertical effects: GE would have become a supplier to its rivals RR and P&W as a result of the deal. Commission found GE would have incentive and ability to disrupt/terminate supplies, and damage its rivals. Creation or strengthening of dominance: in markets where GE competed with HON.

4. CONGLOMERATE EFFECTS PREMERGER DOMINANCE VERTICAL EFFECTS What did the Court find ?