EU regulators opened an investigation into the deal in July, 2015, warning that the merged company could face “insufficient competitive constraints” in a number of European markets, wsj.com reports. They also said they were examining how the merger could affect delivery routes out of Europe.
While executives at both companies have maintained the deal is substantially different than UPS’s attempt in 2013, because FedEx’s current operations in Europe are much smaller than UPS’s were, analysts and people close to the deal had largely expected EU regulators to take a tougher stance.
TNT stock closed up 10% at EUR 7.55 (USD 8.55) after languishing about 15% under FedEx’s offer price of EUR 8 per share in recent weeks as investors worried about a potential EU rebuttal. FedEx shares closed up 1% at USD 154. The deal, announced in April, 2015, would allow FedEx to acquire an extensive ground network in Europe, making it a bigger player in the burgeoning ecommerce market with an established door-to-door road network in the region that connects more than 40 countries.
The purchase would bring FedEx about 58,000 employees, 19 road hubs and 550 depots to its portfolio. It would become the third-largest player in Europe’s international express-delivery market, behind DHL and UPS.
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