Impact Publications : Aircargo_240
Page 8 • AirCArgo AsiA-PACifiC • DECEmbEr - JANuAry 2016 FedEx closing in on TNT deal consummation after EC okays the merger without conditions THE LONG process that is the FedEx Cor- poration’s takeover of TNT Express – a uS$4.8 billion merger deal – has moved sev- eral kilometres ahead with the early-January approval of the plan by the European Commis- sion. but there is still some way to travel, despite approvals in markets such as the uS, Australia and New Zealand. As we reported last year, EC approval was seen as highly likely, but it was vitally important and could have come with conditions. The EC had conducted what it de- scribed as “an in-depth investigation” launched in July 2015. It decided that the acquisition would not give rise to competition concerns because FedEx and TNT “are not particularly close competitors and because the merged entity will continue to face sufficient competition from rivals in all markets concerned”. Commissioner margrethe Vestager, who headed the investigation, com- mented that “many businesses and consumers rely heavily on affordable and reliable small package delivery services, in particular with the growth of e-commerce. Therefore the Com- mission has thoroughly assessed the markets affected by this takeover. “The conclusion is that European consumers will not be adversely affect- ed by the transaction.” David binks, regional president Eu- rope for FedEx said: “we are extreme- ly pleased to receive the European Commission’s unconditional approval. We believe the combination of TNT Ex- press and FedEx will provide significant value to the employees, customers and shareholders of both companies.” FedEx and TNT are continuing to “work constructively” with regulatory authorities to obtain clearance of the transaction in remaining jurisdictions, including brazil and China. A company statement claims “timely progress”. In the wake of the EC thumbs-up, FedEx and TNT announced that “the acceptance period for the recom- mended public offer for all the issued and outstanding ordinary shares in the capital of TNT nv including all Amer- ican depositary shares representing ordinary shares is further extended until two weeks following the satisfac- tion or waiver of the offer condition with respect to competition clearances, but no later than June 6 2016”. As we reported in our daily e-news service at the time, the Australian Com- petition and Consumer Commission (ACCC) approved the FedEx/TNT deal in late November. “based on market inquiries and infor- mation provided by the merger parties, the ACCC determined that the pro- posed acquisition is unlikely to result in increased prices or reduced service levels,” said chairman rod Sims. “The merged entity will continue to face significant competition, including from other international rivals with significant global delivery infrastructure and networks. The merged entity will also face a credible threat of new entry and expansion by rivals.” ACCC said it had consulted with fellow regulatory authorities in its investigation.