UPDATE 1-EU antitrust regulators block 5.2 bln euro UPS, TNT deal

Wed Jan 30, 2013 5:43am EST
 
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* UPS had flagged deal would be blocked

* Regulator says deal would have hurt competition

* Regulator says proposed concessions were inadequate

By Foo Yun Chee

BRUSSELS, Jan 30 (Reuters) - EU antitrust regulators blocked a 5.2 billion euro ($7 billion) bid by United Parcel Service Inc for TNT Express, denting the world No. 1 package delivery company's hopes of expanding its presence in Asia and Latin America.

The EU regulatory veto means the world's No. 1 package delivery company may now have to grow via smaller acquisitions or organically, while TNT could come under pressure to change management or revise its business strategy to deflect activist shareholders.

The European Commission said UPS had not offered adequate concessions to ensure the deal would not hurt consumers. UPS had flagged the negative decision on Jan. 14, saying it would withdraw its bid because of opposition from the EU regulator.

The deal, its biggest ever, would have given it access to Dutch peer TNT's stronger networks in fast-growing Asian markets and Latin America and increased its non-U.S. revenues to 36 percent of total sales from the current 26 percent.

The European Commission, the EU competition watchdog, said the proposed merger would have reduced competition in 15 EU countries.   Continued...