UPS Begins Offer Period in $6.5 Billion TNT Express Takeover
United Parcel Service Inc. (UPS)’s 5.16 billion-euro ($6.5 billion) cash offer for TNT Express NV (TNTE) begins tomorrow and runs through Aug. 31 as the U.S. company seeks to expand in Europe with the biggest deal in its 105-year history.
TNT Express, which agreed to accept the bid of 9.50 euros a share on March 19, will hold an investor meeting in Amsterdam on Aug. 6 to brief its shareholders on the takeover, the companies said today in a joint statement.
UPS, the world’s largest package-delivery company, will vault into equal footing in Europe with Deutsche Post’s DHL, the market-share leader, following the takeover of TNT, which it reiterated today will produce pretax cost savings of 400 million euros to 550 million euros annually after four years.
“The transaction will create a global leader in the logistics industry with more than $60 billion in annual revenue and an enhanced, integrated global network,” the companies said.
UPS reiterated that it’s seeking acceptance of the deal format least 80 percent of shareholders in Hoofddorp, Netherlands-based TNT, spun off last year from Dutch postal operator PostNL NV (PNL), which is tendering its 29.8 percent stake.
The 9.50-euro UPS bid is 5.6 percent higher than a prior 9- euro approach and 54 percent more than the closing price on Feb. 16, the day before talks were made public.
The agreed deal valued TNT at 13 times its previous four quarters’ earnings before interest, taxes, depreciation and amortization, versus a median of 10 times trailing Ebitda in nine similar deals, according to data compiled by Bloomberg.
Atlanta-based UPS closed little changed at $78.17 yesterday and has gained 6.8 percent this year, valuing the company at $75.2 billion.
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