On the heels of FedEx’s big announcement last week that it plans to purchase TNT Express for €4.4 billion, German magazine Wirtschaftswoche reported that UPS plans to invest €1 billion to expand its network in Europe. Wirtschaftswoche did not cite its sources.
“We will strongly expand our network in Germany and the rest of Europe,” UPS Germany chief Frank Sportolari told the magazine. He said the number of parcel stores and sorting centers would rise with this investment.
UPS attempted to purchase TNT two years ago, but the European Commission blocked the deal because it believed the proposed acquisition would have restricted consumer choice given UPS’s larger footprint in Europe. TNT has been suffering for the past several years; its stock dropped 17 percent over the past year. The FedEx-TNT merger would give FedEx greater road access given TNT’s extensive network.
Sportolari told Wirtschaftswoche that UPS “has lost time” after its attempt to take over TNT. This investment, if it comes to fruition, may indicate that the competition is on.
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