United Parcel Service's plan to buy Dutch delivery firm TNT Express moved into a new phase on Friday that looked set to deliver the US firm its prize even though price is still an issue between the pair. The world's largest package delivery company confirmed it was still interested, and said it would seek Dutch regulatory approval for a firm offer by May 11. It made the statement in an update bidders in the Netherlands are obliged to give four weeks after an initial approach.
UPS said talks were "constructive". No rival bid has emerged, and in the meantime TNT has reported weaker than expected results and offered a bleak outlook. Two sources familiar with the situation said the two parties were trying to reach final agreement on price on the roughly 4.9 billion euros ($6.4 billion) deal.
UPS last month proposed 9 euros per share, an offer that the Dutch company rejected. The parties are now hoping to reach a deal by the end of next week, the two sources said. "If we don't find an agreement next week, then we'll be in trouble", said one of the sources, who is familiar with TNT. Any longer wait could cause UPS to lose patience, he said.
The talks are also focused on social issues including the location of TNT's headquarters, employment and the pension fund after TNT rejected UPS's latest bid in February. But these issues had now successfully been resolved, the sources said. TNT Express is not expected to extract a price much higher than 9 euro a share after the company reported weaker than expected results amid a bleak economic outlook.
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