General Electric Co. on Wednesday secured unconditional approval from the European Union to combine its oil and gas business with Baker Hughes Inc. after the bloc's competition authorities found the transaction wouldn't harm competition in Europe.
Announced last October, the GE and Baker Hughes combination would create a company with more than $32 billion in revenue that could cut costs to better compete with rivals such as Schlumberger Ltd. in the provision of equipment and services to oil rigs and wells.
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The merger would come after a difficult period of falling prices in the oil and gas business. Crude prices, which plunged to $30 a barrel last year from more than $100 in 2014, have rebounded, but only to around $50.
The European Commission, the EU's executive branch, said it investigated several markets where products from both companies compete, including onshore and offshore electrical submersible pumps as well as chemicals used for refining petroleum. The regulator said it also looked at markets where GE supplies Baker Hughes and its competitors, including sensors used in drilling.
The EU said there were enough alternative competitors and suppliers in those markets where both companies overlap.
In the U.S., GE and Baker Hughes said in March they had received requests for additional information over the deal from the U.S. Department of Justice.
The companies said Wednesday that they "continue to work constructively with regulators and expect to close the transaction in mid-2017."
Baker Hughes had previously planned to merge with Halliburton Co., but the companies called off that merger last year. The companies encountered opposition on several continents from regulators who claimed that it would hurt competition in the oil-field services business.
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(END) Dow Jones Newswires
May 31, 2017 10:12 ET (14:12 GMT)