Its June $2001,$ and Jack Welch has a problem. General Electrics proposed merger withHoneywell was to be the crowning achievement of his career, but the EuropeanCommission $($the government of the European Union$)$ refused to give its approval unlessGE divested itself of large chunks of its avionics or aircraft leasing businesses. Whatshould he do$?$ Should he agree to the European Commissions conditions? Applypolitical pressure? Call the deal off? At stake was not only the biggest acquisition of hiscareer, but his legacy as one of the most revered business leaders of the $20$th Century.General ElectricGeneral Electric is a diversified industrial and financial company, whose major productlines include appliances, lighting products, aircraft engines, plastics, power systems,medical imaging, broadcasting, and a wide range of financial services $($consumerfinance$,$ leasing, private equity, credit cards, and so on$).$ In $2000,$ GE employed $223,000$people in over one hundred countries and reported net earnings of $$13$b on revenue of$$130$b$\mathrm{.}1$Honeywell InternationalHoneywell International is the result of the $1999$ merger of Honeywell $($a manufacturer ofthermostats, security systems, and industrial control products$)$ with Allied$-$Signal $($adiversified manufacturer focused on aerospace$).$ In $2000,$ Honeywell employed $125,000$people in $95$ countries and reported net income of $$1\mathrm{.}7$b on sales of $$25$b$\mathrm{.}2$Honeywells SuitorsOn October $20,2000,$ the press reported that United Technologies Corporation $($UTX$)$was expected to announce an o er for Honeywell at an estimated $$50-51$ a share.Lehman analyst Joseph Campbell found the strategic fit $...$ obvious and compellingand noted that the two firms had highly complementary product lines that would allowthem to exploit powerful revenue and cost synergies. Other observers noted that thedeal would give UTX a strong market position in most aspects of airplane manufactureother than the airframe itself, including engines $($UTXs Pratt & Whitney unit$)$ andelectronic control, communication, and navigation systems or avionics $($HoneywellAerospace$).$Displaying an agility that impressed even its most avid supporters, GE responded onOctober $22$ with a bid valued at $$55$ a share. UTX immediately dropped out, saying the dealwas not in the interest of its shareholders at that price. For GEs Welch, the acquisition wouldbe the largest of the estimated $1700$ completed during his tenure as CEO.