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Baker Hughes, GE Merger Gets DOJ OK

Baker Hughes Inc. and General Electric Co. said Monday they have reached tentative agreement with the U.S. Department of Justice to allow their mega-merger to be completed by mid-year.

The merger, estimated to be worth more than $32 billion, would create the second largest oilfield services operator after Schlumberger Ltd. GE would be the majority shareholder in the revamped Baker Hughes.

Under a proposed consent decree filed in U.S. District Court for the District of Columbia, GE agreed to sell divest GE Water & Process Technologies once the merger is completed. GE had said in March it would sell the water unit to Suez for $3.4 billion. No other remedies are required by the proposed consent decree. The companies already have been cleared unconditionally by the European Commission to complete the transaction.

Baker Hughes has scheduled a shareholder vote for June 30. The companies continue to target a mid-year close.

Also Monday, Jeff Immelt, 61, who was to become chairman of the combination, said he would retire effective Aug. 1. Current GE Oil & Gas chief Lorenzo Simonelli is to become CEO/president of the combined company while Baker Hughes Chairman/CEO Martin Craighead was named vice chairman.

Immelt, GE's chairman and CEO since 2011, is being succeeded by John Flannery, 55, a 30-year GE veteran who has run the the health care unit since 2014 and previously worked in the financial business unit. In a meeting with employees, Flannery said he wanted to start "with a fresh look around the company overall. I want to go through a deep review with a sense of urgency."

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