EU Court Scraps Decision to Block UPS-TNT Merger in 2013 on Procedural Missteps -- Update
March 07 2017 - 5:54AM
Dow Jones News
By Natalia Drozdiak
BRUSSELS--The European Union's second-highest court on Tuesday
annulled a 2013 decision by the bloc's antitrust watchdog to block
United Parcel Service Inc.'s $7 billion bid for Dutch
parcel-delivery company TNT Express NV on the basis of procedural
missteps by the regulator.
The general court of the EU said the European Commission had
made "non-negligible changes" to the economic analyses previously
discussed with UPS but didn't communicate its final econometric
analysis model to the company before adopting its decision.
"By failing to do so, the commission infringed UPS' rights of
defense," the court said in its statement.
"UPS is pleased to see that its reasoning was upheld by the
European General Court," said Gregg Svingen, International Director
for PR & Communications at UPS.
A European Commission spokesman and spokeswoman didn't
immediately respond to requests for comment.
The commission can appeal the decision to the bloc's highest
court, the Court of Justice.
The landscape has changed since the commission's 2013 decision
and any renewed attempt at a merger between UPS and TNT looks
unlikely.
After UPS called off its merger in mid January 2013 following
stiff objections to the deal from the EU, logistics rival FedEx
Corp. stepped in to acquire TNT in May 2016 for EUR4.4 billion
($4.67 billion), expanding its reach in Europe.
The EU worried the overnight-parcel-delivery market would
effectively become a duopoly between a combined UPS-TNT business
and DHL, a unit of Deutsche Post AG. The regulator also worried
that other parcel-delivery companies, including FedEx, could be
shut out of the market.
The commission formally blocked the UPS-TNT deal at the end of
January 2013.
It is unusual for the bloc's top courts to overturn decisions by
the bloc's executive, the European Commission. However, in
antitrust cases, the court generally overturns commission decisions
primarily on the basis of procedural irregularities.
Write to Natalia Drozdiak at natalia.drozdiak@wsj.com
(END) Dow Jones Newswires
March 07, 2017 05:39 ET (10:39 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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