Brazil quashes UPS appeal over FedEx’s TNT takeover
FedEx has already obtained regulatory approval from anti-trust bodies in the EU, and the US while it is still in pursuit of a similar green signal from authorities in China.
March 30, 2016
By PLA Editor
Air & Cargo Services air cargo Air Cargo Asia air cargo freight Air Forwarding air freight Air Freight Asia Air Freight Logistics air freighter air freighting Air Logistics Asia Air Shipping Asia airlines cargo airways cargo Amazon asia cargo news cargo aviation FedEx Fred Smith TNT UPS
FedEx Corporation has gained approval from Brazil’s anti-trust authorities as the Conselho Administrativo de Defesa Econômica (CADE) has rejected a third-party appeal filed by United Parcel Service over the takeover. UPS appealed after Brazil unconditionally approved the $4.8 billion deal in February.
FedEx has already obtained regulatory approval from anti-trust bodies in the EU, and the US while it is still in pursuit of a similar green signal from authorities in China. The consolidation requires obtaining competition approval from all relevant anti-trust bodies in all four countries and regions named above. FedEx and TNT Express have assured that they are progressing in a timely manner towards the consolidation, and that they expect the takeover to go through in the first half of 2016.
According to Brazilian law, United Parcel Service is the only eligible competitor that can appeal against the merger as it is the only classified third-party interested in the case. UPS had attempted to takeover TNT in 2012 however, its bid was rejected by the European Commission on the grounds that it would reduce competition in the entire region.
If the takeover goes through, it would give FedEx access to TNT’s extensive express networks in Europe. TNT’s strength in Europe combined with FedEx’s extensive aircraft fleets and automated facilities would give FedEx a strong foothold in the courier industry.
Additionally, FedEx has also dismissed Amazon.com as a threat to its business after it emerged recently that FedEx will soon operate a portion of its own supply chain. FedEx’s chairman Fred Smith has contended that it is highly unlikely that the online retailer could pose any threat to FedEx in the short term.
All eyes are drawn towards the anti-trust authorities in China as FedEx inches closer to changing the logistics industry forever. If the deal goes through, the European market will have increased competition from the FedEx-TNT merger which may trigger further consolidation in the industry.