Discussion in 'UPSers International' started by Orange Boy, Aug 30, 2006.
Do you think that UPS will eat the Orange?
Orange and Brown will be our Halloween colors.
And here's the new name, you'll get a kick out of this.........
Any news about this over in the US?
I hear that is is because of the European Network
Michael Duester, last week, said that in five years there will be no such company as TNT. But he refused to be drawn further on the subject.
Make of that what you will!
I doubt UPS will acquire TNT...Maybe DHL, but not UPS. I very much doubt UPS.
With TNT buying road networks in China and India, surely this will become a stronger partner for UPS, or Fedex.
Customers in the UK regard UPS as Cheap and Cheerful as a service.
Looks like the Browntails are leaving a trail.
No, NO, here is the scenario. UPS goes out on strike again, this time instead of Fred calling Ivan; it will be Fred calling Baron Von Klink and proposing a merger, buyout or whatever term
Takeover of TNT?
fedex is not and will not be comfortable with the price or required new senior level management structure after merging. Sometimes I wonder which is holding up the possibility, price or control?
UPS and TNT are too culturally different for such a takeover to go smoothly. If anything, UPS-SCS should have bought TNT's logistics division.
In the meantime, TNT is really being closely examined by private interest.
Life is stranger than fiction, the next industry takeover or merger might be a shocker.
Aside from not being a good "fit" for UPS, TNT does not offer any accretion if purchased. I suspect such an acquisition would be dilutive to earnings and cause a drop in the stock price. We all know the integration problems this company has had with its prior purcahses and how earnings and stock price has suffered.
IMO, UPS should look to expand Capital Corp similar to what GE has done with its finance arm.
I disagree about the potential accretion. TNT has been building an extensive Pan-Asia network, and a Mideast linehaul network, both could be significant contributions to UPS. However, what price is to be paid for such an acquisition?
As you say, the "integration problems" always seem to be the pinch. Not simply integration of corporate culture is in question, but the business arrangements that are already established by both parties may conflict. TNT has the better knowledge/experience base of the two companies in those regions, and retaining such value is not easy when the deck chairs get rearranged.
The best deal for UPS has already been missed, that would have been UPS-SCS and the former TNT Logistics. Such a combination would have put UPS-SCS in a much more competitve position in reference to the top half dozen to ten international forwarders.
Hey, one never knows. When you hear a CEO say his firm is not up for takeover, you can't trust him. It all depands on well the pot is sweetened.
it would be a good buy for ups,we are going well in europe but the 2 combined would be a force to be reckoned with as we are up against dhl (deutsche post government owned).
they also have a good foothold in asia and agood expanding roadfreight business through the middle east.i know it would take abit of time to combine centers but its not as if we have done this before ,overnite/lynx (uk) and other various companies we bought in the last number of years.
as with cost we have a nice few bob(money) in the kitty to go on a spending spree.it will be intrested if our new ceo is more agressive in the buying market,we should have bought exel as they were a worldwide company,also danzas as they have a good roadfreight (standard) service aswell as airfreight worldwide. asg in the nordic countries.
dhl wouldn't be let buy them as they would be stopped by the european union as one company would have too much power and set prices/rates as they like.as ups is an american company with most of the revenue business in the usa ther would be no prob with the eu.
Actually, acquiring TNT would be no easy task. UPS has not done such an acquisition of this scope and scale. Deal making is not a one-size fits all venture.
What do you think TNT is worth? Lets say for discussion purposes, 15-20 Billion USD? Thats a lot of bread. The question is not if UPS can write the check. We all know they probably have excellent lines of credit in addition to cash on hand. Two things have to be taken into consideration:
One, TNT is becoming more expensive to acquire everyday, as TNT CEO Bakker says, the company’s objective is to remain an ongoing concern and strengthen its business.
Two, the always-troublesome questions about who will take what positions at the executive levels has to be figured out. Lets not believe for a moment that the entire TNT executive level will cash out and give total control to UPS.
The entire industry is evolving in a very interesting way.
-The German Railway [DB] bought Bax Global.
-Private equity bought TNT’s profitable logistics division.
-By the way, The German government gave up majority ownership of DPWN years ago. Private and institutional investors are the majority shareholders in DPWN.
-Fedex failed in its attempt to acquire an Indian transport company, however, they did successfully acquire their Chinese JV partner.
The question for all these companies is not really which company is bigger, but what type of strategies are they employing for short and long term growth. Exactly what is the UPS business objective?
UPS want TNT for their infrastructure, customer base and most importantly their European road network.
It was confirmed in January 2008 that UPS upped their shares in TNT to 55% but we are a silent shareholder but the majority shareholder.
I reckon Brown will eat Orange.
A TNT takeover by UPS (or FDX) would first of all from an operational aspect be a good match, and second financially because of a lot of operational synergies.
- TNT has a marketshare of 24% of the European express market, who is more than UPS/FDX has together.
- TNT has a with no doubt the best Road Network in Europe (DHL is far behind in quality).
- TNTs Air European Network is strong and stands for high quality.
- TNT has a modern Air Hub i Liege, Belgium who can take care of the UPS volumes easily.
- TNT posts about 10% bottom line, which is very good industry wise.
- The European economy will have growth in the years to come, unlike the U.S economy.
The buyer can easily make a sell-off of the Dutch Postal Service to several private equity firms (like CVC), making the takeover cost far lower.
I have read a lot about big culture differences between the companies, but hey...I formerly worked at TNT for serveral years and the company is runned in way like many other U.S companies. Strong and detailed management, extreme focus on cost saving projects and high pressure on sales...
It is going to be a bid-race..I do not think FDX can sit comfortable and look at UPS eating TNT. FDX has a very weak European network...
ups is europe has a good road network in europe,while not as good as tnt
look at all the companies they have bought over the last 10 plus years,now i knw theres a few duds along the way but lynx is the final piece in the puzzle in the uk.obviously some depots would overlap and some would close,most of the tnt vans in ireland are owner operators unlike the brown operation in ireland.we could throw it up to dhl although they are not as good as they use to be..but what price to ups pay for our orange friends..
David, have you seen the official UPS communication from UPS House today on what to say to customers if they asked about a merger??....It was to say that we cannot discuss.....think of that what you will.
However there are also the roumers that the UPS-DHL tie up in the USA will spread to Europe in the not to distance future.
DHL are up the creak, TNT are up for sale, UPS want to international freight, were gonna get one of them in Europe.....!!
i didn't see or hear anything ,we are always kept in the dark over here.which one would you pick out of the two.back in 1989 when i worked for walsh western ups's agent in ireland there was rumours that ups were buying dhl an it rested on 1 vote in the end and they didn'y buy because at that time everything dhl had was leased,in fact one of our lads a couple of years back seen a plane in dhl colours leased to them by ups.
i think the tnt option could be the better option especially here in europe to build up more of a foothold especially in italy where our browns haven;t too many uniformed drivers and the amount of facilities tnt has v ups.but with my 20 plus years with ups i have heard all the rumours over the years,we should have bought danzas /asg ...eddie stobart/norbert dentressangle or willi betz in germany now that would be a coup.
Let's just buy them all and be done with it lol.
I would prefer TNT purly because of the network and the fact is they are a decent company and do make money. If UPS was to by DHL, we would speand year's sorting out so much that they have left behind and paying off all of their debts and it would be a nightmare and DHL business is easy to taky anyway.
Lets go for TNT.
We want TNT for Europe, we want DHL for China plain and simple
Even in this economy UPS has a large war coffer to make deals for both of these companies. Id like to see a full DHL deal go first, we need the name and volume going into china where the growth is booming, but I could see a TNT deal going through first in just a logistics manner, a full DHL deal would stretch our airline pretty thin
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