FedEx Launches Bid to Acquire TNT Express NV
Global express delivery giant Federal Express (FedEx) has formally launched its $4.8 billion offer for TNT Express NV and has said that it’s “optimistic the deal will get the necessary regulatory approval.”
FedEx announced its intention to acquire TNT in April, but, earlier this month, the Tennessee-based company faced a major hurdle in its plan after the European Commission in Brussels opened an in-depth investigation into the transaction.
The EC’s has voiced concerns that the combined entity would dominate the delivery of international small packages in some European markets. FedEx, however, said the process of obtaining regulatory approval remains on track.
In separate statements, the two companies said they would “work to address the Commission’s concerns,” with David Binks, FedEx’s president for Europe, stating that both FedEx and TNT “are confident that the combination of both companies will increase competition and create benefits for customers.”
The deal, he added, “presents a pro-competitive proposition for the provision of small package delivery services within and outside Europe.”
FedEx also said that TNT’s chief executive, Tex Gunning, would resign once the deal is completed. Gunning said he would continue to serve on the integration committee of the merged company for a period of six months.
TNT Express will reportedly would continue with its own turnover strategy while the deal was going through the approval process.
In addition to scrutiny from the European Commission, the proposed acquisition is also being reviewed by Chinese and Brazilian authorities.
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