The two companies issued a joint statement last night confirming that Dutch financial regulators have granted permission for their second request to put back the deadline, which had previously been extended to 9th November.

The new deadline of 28th February would change if the EU Commission and Chinese Ministry of Commerce approve the deal – in which case, TNT Express shareholders would have one week after the clearances have been given to approve the takeover.

UPS needs the holders of 80% of TNT Express shares to approve the sale for the deal to go ahead.

UPS and TNT Express said they expect the European and Chinese competition authorities to be the last to give consent to the acquisition, which would create a EUR 45bn turnover company, and see the world’s major shipping integrators reduced from four companies to three.

The companies said they were extending the offer deadline because the clearances would not come before 9th November.

UPS said yesterday that it does have sufficient cash in hand to purchase TNT Express outright.

If competition authorities do not allow the deal to go ahead by 28th February, TNT has the option of terminating the entire deal, and would be entitled under the deal to receive a EUR 200m termination fee from UPS.

Since the EU Commission began its “Phase 2″ investigation of the proposal in July 2012, the two companies have expressed continuing confidence this month that officials will give the go ahead to the acquisition, despite the Commission publicly expressing concerns about the level of competition that will exist in the European express delivery markets following the merger.

Last week after receiving a Statement of Objections from the Commission, both UPS and TNT said they were working  closely with the EU officials and were expecting the deal to conclude early in 2013.

Approvals

UPS and TNT do already have some approvals from competition authorities for their merger.

Last month the Australian Competition and Consumer Commission decided not to oppose the acquisition, stating its belief that the merger “was unlikely to substantially lessen competition” in the international express and standard small package delivery markets.

The ACCC said the international small package market was the only area where there was “significant” overlap between the range of UPS and TNT services in Australia.

“Information provided to the ACCC by interested parties indicated that there was vigorous competition between the major providers of international small parcel delivery services and that competitors to the merged firm would continue to provide a strong competitive constraint post acquisition,” said the Australian regulators.

Source: Post&Parcel/UPS/TNT/ACCC

Tags: Acquisition, Australia, EU Commission, Netherlands, TNT Express, UPS