Bakker to leave TNT as demerger plans confirmed
Peter Bakker will leave TNT after the planned demerger of the company’s Express and Mail units. Bakker has been at the TNT for almost 20 years, and has served as chairman and CEO since 2001.
His planned departure was announced after TNT revealed it will retain a stake of 29.9% in the Express unit to cover separation costs. These shares will be returned to shareholders as soon as possible, the company said.
During the business’ Analysts’ Day, TNT presented how it will separate its Express and Mail operations, and announced that both the Board of Management and the Supervisory Board of TNT have approved all required decisions for the proposed demerger.
“Separation will enable greater internal focus on each business, with single-business investment discipline and capital allocation and leaner, more flexible organisations,” a spokesman said.
The main reasons for separation are the increasingly divergent strategic profiles of the two units and the limited synergies existing between them.
Mail is faced with a continuously declining mail market in the Netherlands and has to focus on sustaining solid cash flows and operational efficiency, whilst express’ priorities are to grow its existing strong European networks, to continue to grow the intercontinental business from and to Europe into adjacent markets and to secure contributions from its existing strong positions in China, South America and India, TNT said.
Express’ target is to generate an EBIT of EUR 900m to 1bn by 2015, whilst Mail’s target in 2015 is stable Cash EBIT (including cash pension contributions and restructuring cash flows) of EUR 300 to 370m. However, expected peaks in the restructuring costs from the Master plans will lead to temporarily lower cash performance in the next coming years, TNT confirmed.
Furthermore, a new Board of Management Express has been created with Marie-Christine Lombard as CEO and Bernard Bot as CFO. Meanwhile, in similar fashion, a new Board of Management has been announced for the Mail unit, headed by CEO Harry Koorstra.
The internal and organisational separation will be completed on 1 January, with the transaction to be proposed to the General meeting of shareholders planned for May 2011, including appointments to the new Executive and Supervisory Boards.
Commenting on the news, Bakker said: “Today, after the most thoughtful preparations, we announce the capital markets transaction that will separate TNT into two strong and successful companies.
“The proposal realises all stakeholder objectives in a low-risk and efficient demerger transaction and provides shareholders the opportunity to invest in two sector leaders. The value of the 29.9% financial minority stake of Express retained by Mail, required to realise the demerger, will be returned to shareholders as soon as possible, up to the level allowed by Mail’s targeted credit rating.
“In Europe, Express has identified profitable growth opportunities in high-end standard parcels and freight and in sector-specific value-added solutions. In emerging markets, Express will continue to lead the way in the development of day-certain express services and further grow its intercontinental business.
“Mail Netherlands is currently hampered by an ongoing lack of agreement with the unions on the social consequences of the Master plan restructuring. Discussions with unions are constructive and continuing, while in the meantime the government-appointed investigator has commenced his work.”
Chairman of the Supervisory Board, Piet Klaver said: “Peter Bakker has been with TNT for almost 20 years, of which the last ten as CEO. Under Peter’s leadership, TNT has been shaped into a strong, professional, responsible, industry leading organisation with a great reputation for corporate responsibility: a company to be truly proud of.
“As a logical next step in the evolution of TNT, Peter has – over the past year – professionally and effectively led the process to split TNT into separate Mail and Express companies, which the Supervisory Board fully endorses.
“Peter has decided to pursue other opportunities after the completion of TNT’s demerger. With high quality management teams for both Mail and Express in place, Peter’s departure at that moment will be logical. Until then, Peter is fully committed and mandated to lead the company towards the completion of the demerger.
“The Supervisory Board regrets Peter’s decision, but we respect and understand his decision just as we respect and highly appreciate Peter’s great contribution to TNT over such a long period.”
More to follow…