UPS has confirmed that it will buy TNT Express for EUR5.16bn (USD6.77bn). In one of the anticipated announcement after it made its bid on 17 Feb, UPS made anannouncement on 19 Mar that the boards of the two companies have issued a joint statement outlining the price and the conditions of the sale. The statement also included a report on the position of the dominant shareholder, PostNL, committing it "irrevocably" to the deal. It appears that TNT Express will continue as a separate entity for some time rather than its assets being wholly absorbed into the European divisions of UPS. The statement asserted that "all employee rights, covenants, and benefits under current ownership will be respected." This may refer to agreements with the workforce over pensions and other benefits which were rumoured to be an important aspect of the negotiations to buy the company. UPS is financing the deal out of a mix of USD3bn in cash and "new debt arrangements".
Descartes Systems Group has designed two new, cloud-based systems that help freight forwarders meet the U.S. and European governments’ security filing requirements. Descartes’ ACAS and ICS for Forwarders systems are built on the company’s Air AMS for Forwarders platform and are connected to its Global Logistics Network. Descartes’ ACAS system was built with U.S. Customs’ regulations in mind and complies with the U.S. Transportation Safety Administration’s and the U.S. Customs and Border Protection’s Air Cargo Advance Screening pilot project. The company’s ICS for Forwarders system enables freight forwarders to submit data directly to the European Import Control System, instead of having to go through the airline.
Just when major competitors like Singapore Airlines and China Airlines are sidelining cargo planes in a desperate effort to arrest the decline in yields, Air China Cargo’s freighter fleet is looking to add new routes. The last two of four B747-400BCFs that Cathay Pacific is contributing to the joint venture with Air China are due to join the carrier’s lineup this month, bringing the total to 12 747 freighters. ACC is looking to India to fill some of its new main-deck capacity. It has obtained approval for the Shanghai-Chennai sector and aims to fly the route three days a week. Elsewhere in Asia, ACC is looking at Dakar, Singapore and Ho Chi Minh City. Applications for these destinations are in the pipeline, but management has not made a final decision on routes and frequencies yet.
UPS announced that it’s in “constructive discussions” with TNT Express regarding its potential acquisition of the Dutch express and cargo delivery services firm. This development comes less than a month after TNT Express rejected UPS’ USD6.4 billion acquisition offer. The negotiations reportedly focus more on the possible disposal of TNT businesses to win European Union antitrust approval and on resulting job losses rather than price. Atlanta-based UPS is unlikely to substantially increase its offer price because TNT Express posted a $225 million net loss for the fourth quarter of 2011 and a potential counterbid from FedEx Corp has failed to materialize. TNT accounted for 9.6 percent of Europe’s express package market in 2010 and UPS had a 7.7 percent share, according to Transport Intelligence. DHL Express controlled 17.6 percent of the market while FedEx had 3.3 percent.
Irish brewer Guinness is tapping a deep thirst in America, with U.S. imports of Guinness’s trademark Irish stout soaring 244 percent in January and February, according to trade intelligence company Panjiva. U.S. imports of Guinness stout bounced back ahead of St. Patrick’s Day from unusually low levels a year ago, when U.S. consumers still had a post-recession hangover. Panjiva’s data shows Guinness imports are up 9.7 percent over early 2009.
Container shipping lines have idled about 5 percent of global fleet capacity, or 800,000 20-foot equivalent units, as demand for container shipping space slows, according to Maersk Line CEO Soren Skou. That figure could soon increase to more than 1 million TEUs, a level not seen since 2009, when trade was severely hit by the financial crisis, Skou said in Singapore on his first overseas trip as CEO. He forecast container demand growth will slow to between 5 and 8 percent in the next few years compared to an average of 10 to 11 percent over the past 25 years as Western economies weaken, manufacturing activity in Asia slows, and products become smaller in size. The overcapacity of containerships and weak demand have led container lines to slash rates in an effort to fill those ships and gain more market share, but this has led to substantial losses. Last year, overall freight rates were 8 percent lower than 2010 while bunker prices rose some 35 percent, Maersk said.
Panalpina and CEVA Logistics have launched new less-than-containerload services, tapping into strong customer demand in fast growing trade lanes in Latin America and the Asia-Pacific region. Panalpina’s four Latin American services, operated by in-house carrier Pantainer Express Line, are part of the Swiss logistics giant’s strategy to create a global LCL network linking the world’s major ports. CEVA Logistics has begun three new LCL services between China and Australia on already operational Asia-Pacific trade lanes. The Netherlands-based logistics group said it plans to launch further LCL services to Sydney and Melbourne from Hong Kong and Hamburg in the coming months.