TNT Express investors are pressuring United Parcel Services (NYSE:UPS) to increase its bid after rejecting an earlier nine-euro-a-share offer on Friday, according to a report by Reuters.
Shares of the Dutch freight and delivery giant were up 55% Monday morning.
Continue Reading Below
The world’s largest package delivery company’s 4.9 billion euro ($6.45 billion) offer was rejected by TNT on Friday, though the companies remained in talks.
The acquisition would give Atlanta-based UPS a bigger presence in Europe, particularly in Britain, France, Germany and the Netherlands, while helping it enter the fast-growing markets in Asia.
A source close to the matter said shareholders are hoping to get between 9.5 to 10 euro a share, according to the report.
SNS fund manager Corne van Zeikl told Reuters on Monday that “everyone is expecting a higher bid.” He noted that UPS rival FedEx (NYSE:FDX) could also enter discussions, which would further pressure UPS to lift its offer.
Since FedEx is smaller than UPS and has less cash to finance such a big deal, Zeijl said he believes UPS would win the deal if it comes back with a higher bid, predicting one as high as 11 euro a share.
TNT shareholders have been unhappy with lackluster sales that have slowed with the global economy and weighed on its stock price, and many investors have called for a management shakeup.