Fedex Heads For Another Bath

Call it Son of ZapMail. Five years after Federal Express took a $366 million charge to close down its money-losing facsimile delivery system, the Memphis company may be close to taking another big bath--this time to stem losses in Europe. The package-delivery carrier conceded as much on Feb. 11, when in reaction to a runup in its stock price, it disclosed that it's considering restructuring its international business or entering into a joint venture.

Analysts say FedEx could piggyback on the hub-and-spoke system being operated in Europe by Australia's TNT and several state-owned postal systems. The pressure is mounting on FedEx to resolve the issue soon. Analyst James Parker of Robinson-Humphrey in Atlanta estimates that FedEx's pretax international loss could total $80 million in the current quarter.