Discuss: UPS in Talks With TNT Over $15 Billion Takeover, Telegraph Says

[cheryl]

UPS in Talks With TNT Over $15 Billion Takeover, Telegraph Says - Bloomberg
Buying Europe's second-biggest express-delivery service would give UPS, based in Atlanta, a full European air and road- delivery network, including an air hub in Liege, Belgium, and a trucking center in the Dutch city of Arnhem. TNT's revenue in 2007 totaled 11 billion euros.

"The rationale is very logical,'' Corne van Zeijl, a senior portfolio manager at SNS Asset Management in Den Bosch, the Netherlands, who oversees about 800 million euros and owns TNT shares. The revenue gains and cost savings from a possible takeover of TNT by UPS "will be rather big.''

When analysts pontificate over the numbers and the math 'look good' or the same spiel about 'synergies' give buyer and seller a warm fuzzy glow of contentment, be careful. UPS should pay as much attention to the 'soft' side of TNT as much as the 'hard' assets it's buying. Many acquisitions have foundered because not enough was done to understand whether the two corporate cultures would 'fit' well together. Granted that UPS and TNT share many organisation characteristics, but are their cultures compatible? UPS is renowned for its military-like discipline, strong management supervision of operating units and global standardisation (of process, procedures and personnel). The opposite of TNT in fact, with it's encouragement of individualism, federal-like autonomy for country business units and the resulting adaptations or lip service paid to global standards by local management. UPS should be careful before reaching for what could be a poison chalice that may give it severe cultural indigestion. Though orange and brown might be a nice colour combination for a time, underneath it could be quite ugly.

[moreluck]

I'm of a contrary opinion.....I think it would be a major coup for UPS to succeed where FDX failed in regards to acquiring TNT.

Acquiring is one thing, integration (and 'digesting') is another. Maybe wiser heads prevailed at FedEx, even if they could afford it.

[BLACKBOX]

Maybe FDX just didn't have the assets to purchase TNT and the deal fell through. This will solidify our footprint in Europe if this happens. Our new motto will be "Conquering one Continent at a time!".