United Parcel Service (UPS) and TNT Express reached (19-Mar-2012) agreement on an all-cash offer of EUR9.50 per share by UPS for TNT Express. The offer values TNT Express at approximately EUR5.16 billion. The offer represents a premium of 53.7% to the share price of TNT Express as of 16-Feb-2012, the day before the parties announced their ongoing discussions. UPS intends to finance the acquisition through USD3 billion in existing cash reserves and through new debt arrangements. Executive and supervisory boards of TNT Express unanimously intend to support and recommend the offer. PostNL, holder of approximately 29.8% of the outstanding shares of TNT Express, has committed itself to tender its shares under the offer, if and when made.
- Creation of an integrated, global logistics company with revenues of more than EUR45 billion p/a. Proportion of UPS revenues generated outside the US will increase from 26% to 36%;
- UPS' express capabilities in Europe expanded with the integration of TNT Express' intra-Europe road freight network;
- TNT Express to benefit from UPS' access to the North American market, as well as access to its logistics solutions;
- Deepening of UPS' position in high growth regions such as the Asia Pacific and Latin America and overall acceleration of UPS' international growth;
- UPS estimates the merger will generate pre-tax cost synergies of approximately EUR400-550 million p/a by the end of the completion of the four-year integration programme. Cumulative pre-tax implementation costs related to achieving these synergies will be approximately EUR1 billion over the four-year integration period;
- UPS and TNT Express will form an integration committee to develop plans to combine both companies' networks and customer relationships and maintain quality standards. The integration committee will also focus on employee integration. [original - PR] [more - CAPA Analysis]