In what would appear to be and indeed is the biggest development in the shipping and logistics industry in 2016, FedEx has acquired TNT Express. The fact that the two major brands have been at loggerheads more often than frequent makes for an interesting tale and the reality that the deal was signed at a whopping $4.8 billion would take many by anticipated surprise.
The announcement was made on Wednesday, 25th May 2016 when TNT Express along with FedEx Acquisition and FedEx Corporation laid out the details of the €4.4 billion deal which amounts to approximately $4.8billion. FedEx is one of the biggest names in the global couriering industry with its prowess over coverage by air and TNT stands out for its expansive European road network. The two put together becomes a formidable force that would perhaps rattle many other major and certainly the lesser known players. FedEx offer reliable international air courier services whilst TNT has a strong economy road network. As a result the combination of both businesses joining each other is a perfect operational fit. Giving FedEx an establish road business in Europe that would take many years to try and have grown organically.
FedEx has had a remarkable journey right from its inception. The company had almost gone bankrupt in just three years after formation. Its founder Frederick W. Smith used the five thousand bucks the company had in cash, played Black Jack in Vegas, won thirty two grand and deposited it in the company bank account which kept them afloat for a few days. The story thereafter as they say is history. Presently, FedEx is one of the largest shipping and logistics companies in the world with annual revenues of circa $49 billion. Whether it is a domestic shipment within the United States or you intend to send a parcel to Netherlands you FedEx can offer a reliable delivery solution.
The merger of FedEx and TNT is partly aimed at strengthening the dominance and particularly expanding the footprint in regions where there is scarce presence. Splitting markets and target audiences would only harm major companies in the long run. Given the development of drones, automated loading and offloading along with several other technological advances in the industry, it is but imperative for many players to join hands and become conjoined networks to offer better services, at faster speeds with greater efficiency but at more affordable costs.