The European Commission has cleared the planned merger between Baker Hughes and GE Oil and Gas.
The body concluded that the deal satisfied EU merger control rules.
Baker Hughes and GE expect to close the deal in mid-2017.
The firms announced the transaction in October 2016, saying it would create an oilfield technology firm with combined revenues of $32billion.
Baker Hughes had previously been lined up for a merger with oilfield service firm Halliburton, only for the deal to be scrapped in 2016.
The two companies said they had pulled the plug due to poor market conditions and “challenges” getting the transaction past regulators.
GE has swooped to take advantage. It will own 62.5% of the “new” Baker Hughes and will contribute $7.4billion to fund a $17.50 per share special dividend to existing Baker Hughes shareholders.