Sony Corp. won European Union approval on Sept. 23 to assimilate a part of Seiko Epson Corp.'s liquid crystal display business.
"The combined entity will have neither 'must-have' technologies nor unique products that competitors would be unable to produce," the European Union's competition watchdog said.
Sony announced in May its first annual loss in 14 years and expects to continue in the red for its current business year to March 2010.
Like other Japanese high-tech giants, both Sony and Seiko have been badly hurt by the global economic downturn which has depressed demand for televisions and other electronic gadgets and pushed up the value of the yen.
Sony chief executive Howard Stringer is slashing 16,000 jobs and axing 10% of the group's manufacturing plants in a bid to return to profit.
The company has had a difficult few years in the face of tough competition from rival products such as Apple's iPod and Nintendo's Wii.
Copyright Agence France-Presse, 2009