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TNT's takeover by UPS collapses on EU objections, share price plummets

Monday 14 January 2013

American courier company UPS has called off its planned merger with Dutch peer TNT Express because of objections from Brussels, TNT said on Monday.

The news led TNT’s share price to plunge around 50% on the Amsterdam stock exchange in early trading. Post NL, which owns nearly 30% of TNT’s shares, was down 34%.

The collapse of the takeover comes after a meeting with officials in Brussels, at which it emerged the working group looking into the deal were working towards a ban. UPS decided to pull out, TNT said in a statement.

Benefits

‘TNT Express regrets this situation, having believed the merger was feasible and beneficial for all stakeholders,’ the Dutch firm said. ‘UPS has confirmed to TNT Express payment of the agreed €200m termination fee.’

UPS agreed to pay €5.16bn or €9.50 a share for Dutch group TNT Express in March 2012. TNT Express was spun off when TNT Post split into its express arm and PostNL in 2011.

However, objections from Brussels, which fears the new group would have a dominant position in several European countries, led to delays. The original takeover deal was revised at least twice.

Recognising the protracted takeover had been a ‘distraction for management’, the company will now soley focus on reassuring customers and staff and strengthening its strategy ‘including further steps to improve profitability’, TNT said.

© DutchNews.nl



 

Readers' Comments

YAY one less American company in the EU

By sarah | 14 January 2013 11:10 AM

I think this was best for UPS as foreign take-overs of Dutch companies are usually over-priced. However, EU regulations and interference will eventually but buyers off. Even with 200 million back out fee UPS is much better off. TNT is overpriced by more than a billion. UPS has been poorly advised.

By larry | 14 January 2013 11:51 AM

Over next few years, you can kiss TNT goodbye. DHK, UPS, FedEx too much for TNT to deal with.

By bruce | 14 January 2013 12:52 PM

The less american influence here the better for europe. they just know how to close down factories and fire people.

By ufo | 14 January 2013 4:49 PM

I agree 2-3 years before they will no longer exist. Only a matter of time for another clueless Dutch company operating as if it's 1962...

By Alfredo M. | 14 January 2013 6:45 PM

More likely, pretyy soon 2 less NL companies in EU - not so yaah. Both PostNL and TNT will suffer from this, but UPS will still get a piece of the volume in the end after TNT falls over..

By Maurice | 14 January 2013 7:26 PM

@sarah - UPS already operates in the EU. They didn't want TNT for their presence in the over-saturated EU market but for their businesses in Latin America and Asia.

So your obvious American hatred aside, you clearly don't understand the situation.

By The Dreamer | 14 January 2013 7:42 PM

TNT's fundamentals are good. They have a good balance sheet, no debt as far as I know and good revenues.

Whether they get bought out eventually or not, they can do OK in the global logistics market.

A good stock opportunity to get TNT at a 40% discount.

By Robert | 14 January 2013 11:55 PM

 
 
 
 
 
 
 
 
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