BRUSSELS -- European Commission officials said concessions offered yesterday by Boeing Co. don't go far enough to overcome European objections to the aerospace giant's $15.5 billion acquisition of McDonnell Douglas Corp.
Boeing, facing a commission-set deadline of midnight last night Brussels time, which had already passed, offered proposals that address one of three outstanding issues, but the offers aren't enough to close the antitrust probe, a commission official said.
"Things had not been sorted out," said European Union Competition Commissioner Karel Van Miert in an interview with Bloomberg News. Boeing spokeswoman Sherry Nebel said Boeing and EU officials were meeting beyond the midnight deadline, though no details of the deliberations were available.
Clinton administration officials warned over the weekend that the U.S. government is prepared to defend Boeing if the Europeans carry through on their threat of sanctions. That message was delivered by a delegation led by Justice Department antitrust chief Joel Klein, who met with European antitrust authorities in Brussels yesterday.
"U.S. interests are implicated by the merger on both the defense and civilian side," Klein said.
Klein was accompanied by three Justice Department antitrust enforcers as well as the Pentagon's undersecretary of defense for industrial affairs, John Goodman, and an assistant.
Investors continue to show little concern about the possibility that fines or other sanctions may be imposed by European regulators if Boeing goes through with the takeover. Boeing shares rose 62.5 cents to $57.125 yesterday and McDonnell Douglas shares rose $1.125 to $72.8125.
At issue for European antitrust regulators is the dominance that Boeing would have in commercial aircraft. Europe's Airbus Industrie would be Boeing's only rival after the acquisition.
The commission wanted to finish negotiating yesterday so it could prepare a formal report for the 20-member commission's scheduled vote July 23. The commission doesn't have the authority to block the merger outright, but it can levy sanctions that include fines totaling billions of dollars.
Van Miert, who's been an outspoken critic of the combination that would create the world's largest aerospace company, said he would consider joining the talks himself once he returned to Brussels from Escorial, Spain, where he delivered a speech.
The U.S. Federal Trade Commission and Defense Department cleared the Boeing takeover earlier this month, saying it doesn't violate federal antitrust laws or thwart competition in markets for commercial aircraft or military equipment.
Three days later, though, an EU advisory panel of antitrust officials from the 15 European Union nations voted unanimously to recommend the commission reject the combination.
Pub Date: 7/15/97