Tue, Apr 09, 2013 - Page 15 News List

UPS seeks clarification on rejected TNT Express bid

Bloomberg

United Parcel Service Inc (UPS) said it appealed the EU regulator’s January decision to block its 5.16 billion euro (US$6.7 billion) bid for TNT Express NV, saying the move aims to clarify the legal reasoning rather than renew its interest in the Dutch rival.

“The reason to appeal would be to ensure a more accurate assessment of the EU competitive landscape and that there’s no precedent that could limit international growth opportunity,” Peggy Gardner, a spokeswoman for Atlanta-based UPS, said by telephone on Sunday.

The world’s largest package-delivery company ended its pursuit of TNT on Jan. 14 after the European Commission’s antitrust regulators indicated they would prohibit the deal. The purchase would have doubled UPS’s footprint in Europe and helped it compete with Deutsche Post AG’s DHL unit.

“The appeal is intended to clarify the EC’s legal assessment of the dynamics of the European express market,” TNT said in a statement yesterday. “It does not imply a renewal or reconsideration of the previously proposed UPS offer.”

The EU formally rejected UPS’s takeover later that month, saying UPS failed to find a suitable buyer for parts of TNT to ensure competition would not be stifled. UPS was trying to divest parts of TNT to La Poste SA’s DPD unit.

The EU blocked the deal because combining UPS and TNT would have increased express-delivery prices in 29 countries, EU Competition Commissioner Joaquin Almunia said on Jan. 30.

While the EU had said FedEx was “the only possible suitable purchaser” for the assets that would need to be divested, that company’s limited reach across Europe meant customers would only be able to choose between UPS-TNT and DHL for next-day deliveries.

TNT “continues to focus on the execution of its updated strategy and profit improvement plan” that includes selling businesses in China and Brazil and cutting 4,000 jobs, the Netherlands-based company said.

On March 28, the company said it would sell its Hoau Chinese domestic road operations to an affiliate of Citic Group Corp.

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