A controversial antitrust decision
The TNT Express share price, which had risen from 6 to 10 euros following the UPS bid, had slipped back below 8 euros in October, when the EU Competition Commissioner José Joaquín Almunia had decided to pursue the Commission’s investigation of the bid. But UPS proved itself to be a determined predator, by countering each objection, in particular by proposing an acceptable purchaser (DPD-La Poste) for the problematic assets, so much so that the share price rose to 8.50 euros on Friday 11 January... before the Commissioner informed UPS on Friday evening of his final prohibition decision, which resulted in the share price falling to 4 euros when the markets opened on 14 January! “The European watchdog is taking a dogmatic position, but would have agreed to the problematic assets being taken over by FedEx… It does not understand, unlike its American counter party, that a reduction in the number of competitors from four to three also helps to reduce costs, therefore prices and is therefore ultimately beneficial for consumers”, notes Lionel Melka from Bernheim Dreyfus & Co. Moreover, UPS has recently announced its intention to appeal against this decision.