UPS Anticipates European Commission to Prohibit Acquisition of TNT Express
United Parcel Service, Inc. (UPS) announced the European Commission (EC) has informed UPS and TNT Express that it is working on a decision to prohibit the proposed acquisition of TNT Express by the U.S. headquartered parcel service.
UPS submitted an initial remedies proposal on Nov. 29, 2012, and subsequently revised the proposal twice. UPS began the competitive review process with the EC in March 2012.
Scott Davis, UPS chairman and CEO said, "We are extremely disappointed with the EC's position. We proposed significant and tangible remedies designed to address the EC's concerns with the transaction. The combined company would have been transformative for the logistics industry, bringing meaningful benefits to consumers and customers around the world, while supporting growth in Europe in particular."
Upon prohibition by the EC, the Offer Condition relating to EU Competition Clearance will not be fulfilled and UPS will pay TNT a termination fee in the amount of EUR 200 million and will withdraw the Offer.
Further announcements will be made once the European Commission has issued its formal decision. The decision is expected to be adopted formally in the coming weeks.