United Parcel Service Inc. (UPS) said its proposed acquisition of TNT Express N.V. (TNTE.AE, TNTEY) is expected to close in the fourth quarter as European Union regulatory authorities need more time to analyze certain areas of the deal.
UPS said the European Commission's review of the deal is expected to move to a Phase II review, which can take up to 25 weeks to complete. The shipping giant said it is likely the offer condition relating to competition clearance will not be satisfied by the end of the initial offer period and said it expects to extend the offer period beyond Aug. 31.
The company had previously expected the deal to close in the third quarter.
In March, UPS reached an agreement to acquire TNT in a deal valuing the Dutch package shipper at around EUR5.16 billion. TNT Express is the smallest of the big four global package shippers, and while it has struggled somewhat in recent months, the merger would give UPS a market-leading position in Europe to round out its big domestic U.S. presence and expanding Asian business.
In April, UPS reported its first-quarter earnings rose 6% on stronger profits in its U.S. package and supply chain and freight businesses, though profit in its international package unit declined.
Shares closed at $79.44 Friday and were unchanged after hours. The stock is up 8.5% since the start of the year.
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