TNT Express Issues Profit Warning, Shareholders Approve Fedex Takeover -- Update
October 05 2015 - 8:34AM
Dow Jones News
(Adds details from shareholder meeting on Fedex takeover)
By Ellen Proper
HOOFDDORP, the Netherlands--Dutch delivery company TNT Express
NV on Monday issued a profit warning due to recent global economic
turmoil, but secured shareholder approval for its $4.9 billion
takeover by FedEx Corp.
TNT said third-quarter adjusted operating profit was "materially
lower" compared with the same period last year amid economic
volatility in Brazil, China and Australia. The company also said
its Australian operations were hit by competitive pressures and
weak commodity markets during the period, and that it suffered from
reduced margins in France.
Shares in TNT were down 1.6% to EUR6.73 in afternoon trading in
Amsterdam.
The profit warning was issued ahead of an extraordinary
shareholder meeting at TNT's headquarters in Hoofddorp, where
investors gathered to discuss the planned takeover by FedEx. They
unanimously approved the EUR8-a-share bid.
The takeover still requires approval from European Union
regulators, who may demand concessions such as asset sales. An
earlier bid for TNT by United Parcel Service Inc. failed in 2013
after resistance from EU regulators.
TNT, however, said it was confident that the deal with FedEx
will follow through and be completed in the first half of 2016. "We
knew it would be a lengthy process, as the European Commission
would thoroughly look into the deal," said Antony Burgmans, the
chairman of TNT's supervisory board. "We see no reason to be
pessimistic about the outcome, on the contrary."
Mr. Burgmans said TNT has a "Plan B" if the deal fails,
referring to a strategy update the company unveiled in February.
That strategy won't lead to significant improvements of TNT's
performance before 2018, he said.
Write to Ellen Proper at Ellen.Proper@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
October 05, 2015 08:19 ET (12:19 GMT)
Copyright (c) 2015 Dow Jones & Company, Inc.
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