Logistics Markets: Express & Mail
UPS buys TNT Express for $5bn
19/Mar/2012 by Staff Writer.
After years of rumours and a comparatively short offer-period, UPS has agreed to buy TNT Express for €5.16bn/US$6.77bn.
In an announcement this morning (Monday 19th), the boards of the two companies issued a joint statement outlining the price and the conditions of the sale. The statement also included a report on the position of the dominant shareholder, PostNL, committing it "irrevocably" to the deal.
It appears that
TNT Express will continue as a separate entity for some time rather than its assets being wholly absorbed into the European divisions of UPS. The statement asserted that "all employee rights, covenants, and benefits under current ownership will be respected." This may refer to agreements with the workforce over pensions and other benefits which were rumoured to be an important aspect of the negotiations to buy the company.
Importantly the statement also continues; "UPS undertakes to create a meaningful centre of excellence for marketing, sales, and operations in the Netherlands. UPS recognizes the significant value of TNT Express' operations, assets and people in Liège and will seek to continue the future utilisation of these operations, assets and people within the combined group." This appears to suggest that the headquarters of UPS in Europe will move to Amsterdam and more clearly that the
Liege hub will remain in operation. The implications for existing UPS operations in Europe may be significant.
UPS is financing the deal out of a mix of US$3bn in cash and "new debt arrangements".