TNT Express not expecting FedEx bid

TNT previously rejected a nine euro a share offer from United Parcel Service, but talks have continued. In response to the developments, TNT’s shares leapt to 10.24 euros – an all-time high, although this was perhaps in anticipation of a bidding war between FedEx and UPS. However, it is thought that while FedEx sees value in TNT, it has been put off by the likely price of a deal.

If UPS does successfully buy TNT Express, it may have to sell off a number of assets in Europe in order to meet regulatory demands. It could be that FedEx will step in at this point to make a few acquisitions.

FedEx has the finances to match a UPS bid, but values TNT lower, perhaps due to its marginal presence in Europe, where it commands just three per cent of the market, versus UPS’s nine per cent. TNT is currently the market leader, boasting 18 per cent market share.

Another possibility for FedEx would be a joint venture with DHL – the latter gaining from FedEx’s strong presence in the US.