FedEx Corp. on Wednesday detailed how it will pay for its EUR4.4
billion ($4.9 billion) acquisition of TNT Express NV, saying it
will use mostly debt to finance the deal.
The company said it has secured EUR2.0 billion in fully
committed debt financing and can use EUR900 million from an
existing credit facility. The company also said it can pay EUR1.5
billion of the offer in available cash.
FedEx agreed in April to buy Dutch package-delivery company TNT,
making an end run around rival United Parcel Service Inc. and
positioning itself to capitalize on the growth of e-commerce in
Europe.
FedEx already has a sizable air-express delivery operation in
Europe, but it lags behind in the ground-delivery business.
Acquiring TNT would give it an established door-to-door road
network in Europe that connects more than 40 countries, saving the
U.S. company the time and money required to build one from
scratch.
But the all-cash FedEx deal is subject to approval by European
Union regulators. In January 2013, EU regulators quashed an effort
by UPS to acquire TNT for about $7 billion, unraveling an agreement
that was about a year in the making.
FedEx said Wednesday that it plans to submit its offer to
Netherlands regulators for approval by June 30, the deadline under
Dutch law.
The deal must also receive antitrust clearance in China, Brazil
and the U.S.
Write to Chelsey Dulaney at Chelsey.Dulaney@wsj.com
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