Back to the Drawing Board for Disappointed TNT Express and UPS
While in the middle of January it had seemed clear that the European Commission was going to block the acquisition of TNT Express by United Parcel Service (NYSE:UPS), the EC didn’t release an official decision until Wednesday, when it met the expectations it had set.
The acquisition would have meant big things for both UPS and TNT.
For UPS, acquiring TNT Express would have boosted its operations within Europe, Asia, and Latin America. Adding TNT Express’s network would have been a step forward in global logistics for UPS, and could have increased UPS’s 10 percent European market share to a 28 percent share and shifted the company’s European revenues from 26 percent to 36 percent of total sales.
For TNT, the acquisition seemed almost like an expected next-step for the company. After UPS made the offer to acquire TNT, the latter’s chief executive left the company. TNT’s own market share is also believed to have eroded during acquisition talks with UPS, leaving the company in a worse state than when negotiations began…