FedEx, TNT Receive Unconditional European Approval for Merger Plan
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FedEx Corp. and Dutch freight and package operator TNT Express announced that the European Commission has decided that their combination doesn’t raise any competitive concerns and has given unconditional approval to the companies’ $4.9 billion merger, moving the plan a step closer to completion.
The announcement follows the European regulator’s decision three months ago that it wouldn’t block the combination that FedEx pursued to broaden its presence in European and Asian markets. In the interim, the agency that two years ago rejected UPS Inc.’s bid to buy TNT was completing a review to determine whether there should be merger conditions, such as divestitures.
Commissioner Margrethe Vestager, in charge of competition policy, commented: "Many businesses and consumers rely heavily on affordable and reliable small package delivery services, in particular with the growth of e-commerce. Therefore, the Commission has thoroughly assessed the markets affected by this takeover. The conclusion is that European consumers will not be adversely affected by the transaction."
FedEx and TNT, which still need approvals from China and Brazil, continue to target a completion of the deal in the first half of this year, maintaining that their combination will increase competition worldwide.
FedEx, which is the fourth-largest package operator in Europe, made its acquisition proposal in April to create a combined presence in Europe that is similar in size to UPS on that continent. EC regulators turned down UPS’ bid for TNT because of a perceived reduction in competition as a result of combining the second- and third-largest package companies behind DHL Express.
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