Dutch package shipper TNT Express has rejected a EUR4.9 billion ($6.45 billion) acquisition bid from U.S. rival United Parcel Service (UPS), even as both companies said that discussions between the two parties “continue.”
UPS, the world’s largest package delivery service, confirmed in a statement on February 17 that it had proposed to buy the whole issued capital of TNT Express, the second largest package delivery company in Europe.
“In response to the announcement from TNT Express NV, UPS confirms that, on 11 February, 2012, following discussions with TNT, it made a revised, increased and comprehensive proposal to acquire the entire issued share capital of TNT for EUR9 per share in cash. Discussions between the parties concerning this proposal are ongoing, although there is currently no certainty that any agreement will be reached,” UPS said.
TNT Express on the same day announced it received an “unsolicited non-binding and conditional proposal from United Parcel Service, Inc. for the acquisition of the whole of the issued capital of TNT Express at an indicative price of €9 per ordinary share.”
It added that its supervisory and executive boards “carefully considered the indicative proposal and explored its rationale, merits and risks for shareholders and all other stakeholders,” and rejected the proposal “but continue to be in discussions.”
UPS tendered the bid as some shareholders of TNT urged for a company-board shakeup and increase in shareholder value after the European group suffered falling revenues as the global economic slowdown prompted customers to choose lower-cost shipping over air transport.
If UPS makes a successful purchase of TNT, the acquisition would substantially expand its presence in Europe.
Photo courtesy of TNT Express
