UPS takeover of TNT delayed, may hit PostNL dividend this year

Monday 16 July 2012

The European Commission's review of the takeover of Dutch firm TNT Express by UPS will delay finalisation of the deal until the fourth quarter of this year, the American delivery giant said in a statement.

This is because there are 'certain areas that require more time to analyse', UPS said.

This 'phase II' investigation is likely to take 25 weeks as the Commission looks at the effect of the takeover on the European express delivery market. According to the Financieele Dagblad, both companies had regarded European approval as a formality.

Questions

However, competitors and analysts had expected a longer investigation because of the dominant position the merged group will have in the Benelux countries, Germany and Britain, the paper said. Two members of the European parliament have also raised questions about the deal.

UPS agreed to pay €5.16bn or €9.50 a share for Dutch group TNT Express in March.

Meanwhile, Dutch postal delivery group PostNL said it may not pay a dividend to shareholders this year because of the delay.

'If the takeover is delayed for some time, it will be difficult to pay a dividend,' a spokesman said. PostNL has 29.8% of TNT Express' shares.

TNT Express was spun off when TNT Post split into its express arm and PostNL last year.

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