UPS to buy TNT Express
Monday 19 March 2012
The world's largest delivery company, United Parcel Service,
boosted its presence in the UK today with a deal to buy European rival TNT Express.
Holland-based TNT Express employs some 10,000 staff in the UK and Ireland with 50 delivery depots and large sites at Atherstone, Warwickshire, and Bury, Lancashire.
While UPS is a major player in the United States, the Atlanta-based firm's operations in the UK are smaller, with 7,200 staff and a head office at Feltham, Middlesex.
TNT has agreed an improved 5.2 billion euro (£4.4 billion) takeover offer from its US rival that would see it expand across Europe and several emerging markets and create a company with annual sales of 45 billion euros (£37.4 billion) and 475,000 employees worldwide.
While UPS said the merger would enhance prospects for both sets of employees, there is also the prospect of job losses as the group looks to make up to 550 million euros (£457 million) of cost savings in four years.
Germany's Deutsche Post DHL has called on regulators to look carefully at the deal, which would be the biggest yet acquisition for UPS and has yet to be approved by shareholders.
But the merger is not expected to face serious opposition from anti-trust authorities, as TNT has virtually no presence in the US, while the European market is highly fragmented.
The offer comes after years of speculation about the future of the Dutch delivery company, which was split from the Dutch mail company PostNL and listed last year.
Last month, TNT reported losses of 173 million euros for its fourth quarter, amid rising fuel costs and the eurozone debt crisis, while revenues rose 2.8% to 1.85 billion euros. Days earlier it had rejected a slightly lower offer from UPS.
UPS was started in Seattle in 1907 when 19-year-old James E Casey borrowed 100 US dollars from a friend and established the American Messenger Company, which ran errands and delivered packages.
It now covers more than 220 countries and employs 398,300 staff with revenues of $53.1 billion.
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