Acquiring of one of the largest mail and parcel carriers in the United Kingdom will strengthen Deutsche Post DHL Group’s cross-border network and expand its customer base in Europe’s largest e-commerce market, according to a statement from the company.
Deutsche Post DHL Group will acquire UK Mail Group plc for 242.7 million British pounds ($315.63 million), the company said in a statement today.
The parties agreed on an all-cash offer of 4.40 pounds per share, a 43.1 percent premium over the closing share price for UK Mail on Tuesday, Sept. 27, 2016 of 3.12 pounds per share.
UK Mail’s stock price shot up more than 41 percent on the news, however, closing at 4.41 pounds per share on Wednesday, a penny higher than the offer price.
DHL said it expects the company’s directors to make a unanimous recommendation that UK Mail shareholders accept the offer.
The acquisition of UK Mail, one of the largest mail and parcel carriers in the United Kingdom, will strengthen DHL’s cross-border network and expand its customer base in Europe’s largest e-commerce market, according to the company. The purchase gives DHL a commercial and operational presence in the UK, including pick-up and delivery capabilities, enhances market position for both parties, and has the potential to deliver “significant” synergies.
Founded in 1971 by current Chairman Peter Kane, UK Mail has a network of over 50 sites in the UK, including an automated national hub in Ryton, which can process up to 20,000 parcels per hour. The parcel carrier offers integrated services with a full range of time-sensitive and secure delivery options for both packages and letters.
Juergen Gerdes, Deutsche Post DHL Group Board Member, said the purchase is part of an ongoing drive to expand the company’s European parcel network to meet growing demand for cross-border e-commerce shipments.
The company’s DHL Parcel Europe subsidiary earlier this week announced it is expanding its delivery network to include Hungary and Slovenia though a strategic partnership the Slovenian Pošta Slovenije and the Hungarian Magyar Posta launched earlier this month. Under the agreement, DHL Parcel Europe will provide shorter transit times for cross-border e-commerce services to both countries, the company said.
“Deutsche Post DHL Group, as the leader in the German parcel market, has already established a strong position in a number of European countries,” said Gerdes. “UK Mail is a well-run business and an established provider of quality delivery services in the UK and offers a complementary fit with our integrated offering. With this acquisition, we will further extend our network and have a strong foothold in Europe’s three largest e-commerce markets, the UK, Germany and France, which account for over 60 percent of online retail in the continent.”
DHL Parcel has since 2014 expanded its cross-border network to cover 18 European countries, pioneering a number of innovative solutions in the process, from same-day and time-specific delivery, to automated Packstations and parcel shops to make receiving deliveries more convenient.
DHL to buy UK Mail for $316m
