FedEx Corporation and TNT Express N.V. announced their intention to merge through an all-cash offer for all issued of TNT Express for a cash offer price of €8.00 per share in a transaction valuing TNT Express at an implied equity value of approximately €4.4 billion ($4.8 billion). The Offer Price represents a premium of 33 per cent over the closing price of 2 April 2015 and a premium of 42 per cent over the average volume weighted price per TNT Express Share of €5.63 ($6.14) over the last three calendar months.

Frederick W. Smith, Chairman and CEO of FedEx Corp., said: “We believe that this strategic acquisition will add significant value for FedEx shareowners, team members and customers around the globe. This transaction 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.”

Tex Gunning, CEO of TNT Express, said: “This offer comes at a time of important transformations within TNT Express and we were fully geared to executing our stand-alone strategy. But while we did not solicit an acquisition, we truly believe that FedEx’s proposal, both from a financial and a non-financial view, is good news for all stakeholders. Our people and customers can profit from the true global reach and expanded propositions, while with this offer our shareholders can already reap benefits today that otherwise would only have been available in the longer run.”

The combined companies would be a strong global competitor in the transportation and logistics industry, drawing on the considerable and complementary strengths of both FedEx and TNT Express. The combined companies’ customers would enjoy access to a considerably enhanced, integrated global network. This network would benefit from the combined strength of TNT Express strong European road platform and Liege hub and FedEx’s strength in other regions globally, including North America and Asia. TNT Express customers would also benefit from access to the FedEx portfolio of solutions, including global air express, freight forwarding, contract logistics and surface transportation capabilities.

FedEx and TNT Express are confident that FedEx will secure all relevant completion approvals as soon as practicable. The combination of FedEx and TNT Express is not expected to raise antitrust concerns, principally as a result of the strengths of competitors in relevant markets. FedEx and TNT Express anticipate that the Offer will close in the first half of calendar year 2016.

Almost three years ago to the day, UPS announced its intention to purchase TNT Express in a $6.8 billion deal that was scuttled almost a year later by the European Commission. However, FedEx has a smaller European business which allowed it to express confidence that it will achieve regulatory approval. The deal has been underpinned by a strong dollar that has given FedEx the opportunity to purchase a quality business at an attractive price. Also, TNT’s share price had declined as a result of stagnant revenues and financial losses reported for 2013 and 2014. With FedEx recognized as a strong operator, FedEx clearly has the necessary expertise to affect a business turnaround on the TNT side of the combined business, and will insist on maximum synergies to be achieved.