EU Checks If UPS-TNT Competition From DHL, FedEx Suffices
European Union antitrust regulators are analyzing whether a combination between United Parcel Service Inc. (UPS) and TNT Express NV (TNTE) would be sufficiently challenged by express delivery rivals FedEx Corp. (FDX) and Deutsche Post AG (DPW)’s DHL Worldwide Express, the bloc’s antitrust chief said.
“An important issue in our analysis is whether the company that resulted from the merger would be challenged enough by the other two competitors; DHL and FedEx,” EU Competition Commissioner Joaquin Almunia said in a speech in Nicosia, Cyprus, today. “It is important that customers continue to have access to these services at competitive conditions.”
The European Commission is examining whether the deal may reduce competition for parcel delivery services in Europe. It’s “possible” that regulators may send a statement of objections listing their antitrust concerns with the deal, Almunia said last month.
UPS agreed in March to buy TNT for 5.16 billion euros ($6.66 billion), or 9.5 euros a share, in cash. The transaction would help it expand in Europe and vault to equal footing there with Deutsche Post’s DHL, the market-share leader. The tie-up with money-losing TNT would immediately add to earnings on an adjusted basis once the deal is done, Atlanta-based UPS said at the time.
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