Monday, 8 April 2013

UPS launches appeal against EC ban on TNT takeover

UPS have announced their intention to appeal the European Commission’s decision to block their €5.2 billion merger with Dutch competitor TNT Express.

File:UPS Airlines (N288UP) McDonnell Douglas MD-11F climbs just after taking off at Sydney Airport.jpg
Image c/o UPS
The appeal does not indicate the US courier company’s intention to renew or reconsider its offer. Rather, UPS are seeking to clarify the circumstances surrounding the veto of the merger so as to ensure possibilities for future expansion.

UPS Spokesperson Peggy Gardener said: "We are challenging the decision in order to ensure a more accurate assessment of the EU competitive landscape and that no precedent is established by the EC that would limit international growth opportunities."   

UPS abandoned their bid to take over TNT in January 2013 when it became apparent that the EC intended to prohibit the merger on the grounds that it would restrict competition in the EU and may result in price increases. Gardner described the EC’s decision as “factually and legally erroneous”.

TNT’s stock plummeted after the withdrawal of UPS bid in January but has shown signs of recovery since then. For its part, the Dutch company is implementing a recently announced updated strategy and profit improvement plan.

Sources: Reuters, Bloomberg, TNT

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