The Australian Competition and Consumer Commission has announced that it will not oppose FedEx Corporation’s (FedEx) proposed acquisition of TNT Express N.V. (TNT).
FedEx and TNT primarily overlap in the supply of express international delivery services of small packages (express services). Express services have time-definite or day-definite delivery guarantees, which are distinguishable from standard air mail services.
“The ACCC sought information and views from a range of interested parties including online retailers and suppliers of express services. Customers did not raise significant competition concerns with the ACCC,” ACCC Chairman Rod Sims said.
“Based on market inquiries and information provided by the merger parties, the ACCC determined that the proposed acquisition is unlikely to result in increased prices or reduced service levels. The merged entity will continue to face significant competition, including from other international rivals with significant global delivery infrastructure and networks. The merged entity will also face a credible threat of new entry and expansion by rivals.”
“Customers of express services face low costs to switch suppliers. If the merged entity attempted to increase prices, most customers indicated they could move to other suppliers, most notably DHL or UPS,” Mr Sims said.
The ACCC consulted other international competition regulators in the course of its review, including the European Commission, whose review is ongoing, and the New Zealand Commerce Commission, which recently approved the proposed acquisition.
FedEx provides small package delivery and freight services through an integrated global network. In Australia, FedEx supplies express services for small packages and freight to approximately 220 countries worldwide.
TNT is an international delivery services company. In Australia, TNT supplies both domestic and international small package delivery services, and domestic and international freight services.