Antitrust Law Daily GE settles Justice Department suit related to acquisition of Baker Hughes
Monday, June 12, 2017

GE settles Justice Department suit related to acquisition of Baker Hughes

By Jody Coultas, J.D.

General Electric Co. agreed to divest GE’s Water & Process Technologies business in order to proceed with a merger with Baker Hughes Incorporated after the Justice Department filed a complaint to block the proposed transaction in the federal district court in the District of Columbia.

Among its many areas of business, GE supplies the oil and gas industry with a variety of products and services. Baker Hughes also serves customers across the oil and natural gas industries. GE and Baker are two of the four companies that provide sophisticated chemicals and services required in the oil and gas industry.

The Justice Department alleged in its complaint that the proposed transaction would create one of the largest oilfield service companies in the United States with $32 billion of combined revenue, and substantially lessen competition for refinery chemicals and services in the United States, leading to higher prices and a reduction in service quality. If approved by the court, the proposed settlement would resolve the Department’s concerns.

"Competition to provide refinery chemicals and services benefits a vital sector of our economy," said Acting Assistant Attorney General Andrew Finch of the Antitrust Division. "Today’s action will ensure that oil and gas refiners continue to receive competitive prices for the chemicals and services needed to produce oil, gasoline, and other refined petroleum and natural gas products."

The Antitrust Division cooperated closely with its counterparts in a number of jurisdictions, including the European Commission, Canada, and Australia.

Companies: General Electric Co.; Baker Hughes Incorporated

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