FedEx (FDX) in No Rush to Place Bid for TNT Express (UPS)
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FedEx (NYSE: FDX) was expected to place a bid for TNT Express after a $6.9 billion takeover deal from United Parcel Services (NYSE: UPS) faded away on Monday. But, a proposal may not come along too soon.
Shares of TNT plummeted 41 percent to €4.84 following the news, leading to some of the lowest multiples for profit and sales since the company was spun off of PostNL in 2011, according to Bloomberg-compiled data. TNT was at 0.37 times sales and 6.2 times EBITDA.
FedEx might hold off for now to see whether or not TNT's finances and operation decline before taking any sort of action. That might mean a 12-month wait to gauge how the European market is shaping up.
UPS updates its proposal recently, saying it would divest certain TNT assets and open-up TNT's air network to rivals. The European Union was aiming to form another company with similar market power, according to Competition Commissioner Joaquin Almunia. Ultimately, UPS concessions weren't enough to spur a change of opinion.
The EC will formally reject the deal on February 5th.
FedEx is down modestly along with broader markets Tuesday.
Shares of TNT plummeted 41 percent to €4.84 following the news, leading to some of the lowest multiples for profit and sales since the company was spun off of PostNL in 2011, according to Bloomberg-compiled data. TNT was at 0.37 times sales and 6.2 times EBITDA.
FedEx might hold off for now to see whether or not TNT's finances and operation decline before taking any sort of action. That might mean a 12-month wait to gauge how the European market is shaping up.
UPS updates its proposal recently, saying it would divest certain TNT assets and open-up TNT's air network to rivals. The European Union was aiming to form another company with similar market power, according to Competition Commissioner Joaquin Almunia. Ultimately, UPS concessions weren't enough to spur a change of opinion.
The EC will formally reject the deal on February 5th.
FedEx is down modestly along with broader markets Tuesday.
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