UPS criticizes European Commission for its 2013 decision to block company's acquisition of TNT Express, notes that analysis of decision released by EC on May 7, 2014, recognizes that 95% of combined business was not problematic
May 7, 2014
– The European Commission (EC) today published the summary of its 2013 decision to block the acquisition of TNT Express N.V. by United Parcel Service, Inc. (UPS).
The EC's analysis recognized that 95 per cent of the combined UPS and TNT business was not problematic. Additionally, there were no concerns in the countries that drive 80 per cent of European Union (EU) GDP, namely France, Spain, Germany, Italy and the UK. In the 15 countries where concerns were identified, UPS proposed significant and tangible remedies.
With its decision, the EC prevented a sizeable investment in Europe of approximately EUR 5.2 billion ($6.8 billion), better services and pricing, and more important, an improvement of the European logistics infrastructure in those economies that are still struggling to return to economic growth.
In April 2013, UPS appealed the EC's decision to block the transaction for several reasons: the decision was not based on an accurate assessment of the multi-product nature of customer contracts, it erroneously focused on a single product (next day cross-border shipments), ignored significant evidence from UPS and TNT about the strength and number of other competitors, and considered only a fraction of the efficiencies that would have been created following the acquisition.
Note: The announcement by the European Commission regarding the prohibition occurred Jan. 30, 2013 and UPS filed an appeal on Apr. 5, 2013. The appeal was to ensure a more accurate assessment of the European Union competitive landscape and to ensure no precedent is established by the EC that would limit international growth opportunities.
UPS (NYSE: UPS) is a global leader in logistics, offering a broad range of solutions including transporting packages and freight; facilitating international trade, and deploying advanced technology to more efficiently manage the world of business. Headquartered in Atlanta, UPS serves more than 220 countries and territories worldwide. The company can be found on the web at ups.com® and its corporate blog can be found at blog.ups.com. To get UPS news direct, visit pressroom.ups.com/RSS.