Boeing Merger Approved

THE DAILY FED

Boeing Merger Approved

The Federal Trade Commission on Tuesday approved the merger of Boeing Co. and McDonnell Douglas Corp., paving the way for two of the government's largest contractors to combine into the world's largest aerospace company.

The key to approval of the merger, the Associated Press reported, was the belief of FTC commissioners that McDonnell Douglas could no longer compete in the commercial aircraft market on its own.

The deal, which must be approved by shareholders of both firms, would create a company with more than 200,000 employees and projected annual revenues of $48 billion, the AP reported.

The Pentagon did not oppose the merger, and told the FTC it would not hinder competitiveness for military contracts.

Four of the FTC's five commissioners, in a joint opinion, noted that while both McDonnell Douglas and Boeing build fighter aircraft, they don't directly compete for fighter contracts or other military business.