FedEx Buys Rival TNT For $4.8 Billion

07/04/2015 4:34 PM IST | Updated 15/07/2016 8:25 AM IST
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David J. Bronczek (R), president and chief executive officer of FedEx Express, and Tex Gunning (L), CEO of the Dutch TNT Express attend a press conference in Amsterdam on April 7, 20015, regarding the acquisition of TNT by the US FedEx. US delivery service FedEx has reached a deal to buy Dutch rival TNT Express for 4.4 billion euros (4.8 billion dollars), ramping up its presence in Europe as global e-commerce continues to expand. AFP PHOTO / ANP KOEN VAN WEEL netherlands out (Photo credit should read Koen van Weel/AFP/Getty Images)

THE HAGUE, Netherlands — American package delivery service FedEx has agreed to take over Dutch rival TNT Express, one of Europe's largest delivery companies, for 4.4 billion euros ($4.8 billion), the companies announced Tuesday, in a move FedEx said will strengthen its business globally.

FedEx Corporation has reached a conditional agreement with TNT Express' management on an all-cash offer of eight euros ($8.75) for each TNT Express share. That represents a premium of 33 percent over the share's April 2 closing price, the companies said.

They said the deal is expected to close in the first half of 2016, pending shareholder approval. Dutch postal company PostNL, which owns a 14.7 percent stake in TNT Express, said it supports the bid.

The planned takeover comes two years after United Parcel Service Inc. dropped a 5.2 billion-euro takeover bid for TNT Express, citing objections by European Union regulators.

TNT Express and FedEx said they are "confident that anti-trust concerns, if any, can be addressed adequately in a timely fashion."

FedEx chairman and CEO Fred Smith said in a statement that the deal "allows us to quickly broaden our portfolio of international transportation solutions to take advantage of market trends - especially the continuing growth of global e-commerce - and positions FedEx for greater long-term profitable growth."

TNT Express CEO Tex Gunning said that while his company did not solicit the takeover bid, "we truly believe that FedEx's proposal, both from a financial and a nonfinancial view, is good news for all stakeholders."

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