China today gave conditional approval to US aerospace and defence contractor United Technologies Corp's (UTC) $16.5 billion acquisition of rival Goodrich Corp, saying Goodrich needs to divest or sell parts of some businesses.
The Chinese commerce ministry said in a statement on its website that United Technologies should divest within six months its electrical power generation and transmission systems businesses and 60 per cent of Aerolec, a joint venture with Thales Avionics.
The Chinese conditional approval came a few days after UTC offered to sell undisclosed assets in order to allay possible antitrust concerns of the European Union regulators.
With an eye on surging global sales orders for commercial planes, Connecticut-based UTC in September 2011 proposed to acquire Goodrich, a global supplier of systems and services to aircraft and engine manufacturers, airlines and defence forces
The European Commission (EC) has been reviewing UTC's biggest deal and has set 31 August as the deadline for its decision after consulting close rivals and customers of both companies
The EC is concerned that the deal will create a company holding a large chunk of the market share in engine controls and AC power generators, as well as fuel nozzles.
The EC as well as UTC did not reveal what concessions have been offered, but UTC, which also owns the Otis brand of elevators and escalators, had earlier said that it would sell its Rocketdyne space unit, Clipper Windpower and pump and compressor-making units of Hamilton Sundstrand aircraft components division in order to fund the acquisition.