There are, of course, the usual regulatory hurdles to be surmounted, but at this point it is hard to imagine that the deal will not get done fairly swiftly. Assuming that it does, UPS will have annual revenues of about US$60 billion (€45 billion), putting it well ahead of Germany-based Deutsche Post-DHL as the largest express and logistics company in the world.
Revenue projections have lured many companies into mergers that turn out to be disastrous, but UPS says it believes the combination of the two companies will result in annual pre-tax savings of $525 million to $725 million (€400 million to €550 million) by the end of the fourth year, while the pre-tax cost of the integration will be about $1.3 billion (€1 billion) over the four-year period. And as for the bottom line, UPS said it believed the transaction would be EPS accretive even in its first year.
We will analyze the implications of the deal at length in the next issue of Cargo Facts, and it is sure to be a topic of interest at our upcoming Cargo Facts Asia event in Hong Kong on 17 – 18 April.