With the merger's death now a foregone conclusion, the only remaining drama in General Electric Co's bid for Honeywell International Monday was whether the companies would withdraw the whole offer before the European Commission kills it on Tuesday.

The two companies have been ``actively considering'' withdrawal of the $42 billion transaction late on Monday or early on Tuesday, sources close to the talks said. GE had no comment on the matter.

The 20-member European Commission has scheduled a vote for Tuesday afternoon in Strasbourg, France, where everyone involved -- including the companies -- expects the merger to be rejected.

Commission experts have argued that if GE were to combine with Honeywell, the new firm would enjoy an unfair advantage over rivals in the markets for large civil aircraft and avionics.

It makes sense that the companies would choose to withdraw instead of facing a negative vote, experts said. They said a withdrawal -- which is what usually happens in cases like this -- avoids precedent-setting findings that could be used against the companies in some future case.

Commission spokeswoman Amelia Torres, asked about the possibility of withdrawal, said a merger may be withdrawn at any time, but noted: ``We need to have a formal withdrawal. It is not sufficient to make an announcement.'' And she reminded reporters that the issue was on the agenda for Tuesday's Commission meeting.

The last chance to save the deal evaporated Friday when GE Chief Executive Officer Jack Welch rejected a last-minute suggestion by his counterpart at Honeywell, Michael Bonsignore, to slash $1.7 billion from GE's price tag to compensate GE for extra divestitures in order to win Commission approval for the merger.

Two weeks ago, GE offered to sell assets that generate $2.2 billion in revenues and separate the management and accounts of its aircraft leasing arm, GE Capital Aviation Services, or Gecas, from the rest of the company. That fell short of regulators' demands.

Commissioner Mario Monti also wanted GE to divest a piece of Gecas to competitors Rolls-Royce Plc or Pratt & Whitney, a unit of United Technologies Corp., according to a document obtained by Reuters.

On Friday, Bonsignore was ready to agree to everything that the Commission wanted to get the deal done, but Welch was not.

``What the Commission is seeking cuts the heart out of the strategic rationale of our deal,'' Welch said in a letter to Bonsignore. ``The new deal you propose, in response to the Commission, makes no sense for our shareowners, for the same strategic reasons.''

Shares of Honeywell sank on Friday on the news of the exchange between Welch and Bonsignore, dropping $3.21, or 8.4 percent, to close at $34.99 on the New York Stock Exchange, their lowest close since October 18, five days before the deal with GE was announced. GE shares fell 12 cents to $48.75.

The withdrawal, or possibly the vote, will mark the end of a long process that began October 22, 2000, with the announcement of the deal.

On February 5, the companies filed with the European Union with the expectation of a quick, one-month approval. Welch came to Brussels twice to meet with Monti.

But late that month, Monti instead announced an in-depth, four-month investigation of the deal. It is that process which is now drawing to a close.

The United States approved the transaction in early May. As it became increasingly apparent that the deal was running into problems in Europe, the Commission received criticism from President Bush and several members of his Cabinet. In the end, however, their intervention was unable to change the situation.

-- Reuters and the Associated Press contributed to this report.