By Stephen Nakrosis
Eaton Corp PLC on Wednesday said both it and Danfoss A/S have agreed to a proposed settlement with the U.S. Department of Justice pertaining to the sale of Eaton's hydraulics business to Danfoss.
The department said it will require both Danfoss and Eaton divest assets from their respective orbital motor and hydraulic steering unit manufacturing businesses to proceed with the proposed deal.
"Without these divestitures, the transaction would substantially lessen competition in the design, manufacture, and sale of orbital motors and hydraulic steering units used in agricultural, industrial and construction equipment in the United States," the department said.
The proposed settlement calls for the companies to divest three Danfoss facilities and two Eaton to Interpump Group S.p.A., or to an alternate company approved by the U.S.
Eaton said the divestitures didn't have to take place prior to the completion of the deal.
Eaton also said the "European Commission approved Interpump as a suitable purchaser of the orbital motor and steering assets."
The sale is expected to close in the next several weeks, Eaton said.
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(END) Dow Jones Newswires