plan to buy
was approved by the
on Friday, according to published reports.
"To a large extent, the businesses of Northrop and Litton are complementary and the overlaps between their activities are very limited,'' the commission said in a statement. "Consequently, the proposed transaction will not give rise to any creation or strengthening of a dominant position in Europe."
Grumman and Litton said they would employ 80,000 people, with only minor job cuts on the horizon for the combined company.
Grumman, the fifth largest military defense contractor in the U.S. announced
in December it would buy the shipbuilding company for $5.1 billion in cash, including the assumption of $1.3 billion in debt. Grumman, which is based in Los Angeles, said also said at the time that the deal would be neutral to earnings in 2001, but add double-digit gains to earnings in 2002 and beyond.
At the time, the companies said they expected to save at least $250 million in costs over the next few years, including $100 million in the first year following completion of the deal.
Shares of Grumman gained 87 cents, or 1%, to $87.15 in recent
New York Stock Exchange
trading, while Litton was up 21 cents, 0.26%, to $79.66.