DHL to acquire Airborne
Achieving strong No. 3 market position in the U.S.
Bonn, 03/25/2003, 10:30 AM CET
Customers will get access to a broader product portfolio
Purchase price: 1.05 billion $US
DHL, a subsidiary of Deutsche Post World Net, announced today, that it has entered into a definitive merger agreement with the US based express parcel delivery provider Airborne, Inc. (NYSE: ABF). This transaction will increase market shares and profitability of both partners, hence creating a strong No. 3 in the US market to compete with the dominating players. Subject to the agreement are the entire non-airline related business activities of Airborne; airline business will be separated and will be owned as "ABX Air" by Airborne's current shareholders.
As a result of the acquisition of Airborne, clients get access to a broader product portfolio and improved services. The transaction will provide DHl with a comprehensive network covering North America, the world's largest market for express delivery. The combination will enable growth of the joint businesses and create a stable environment for the employees.
The service portfolios of Airborne and DHL are complementary. In future, the international capability of DHL - market leader outside the U.S. and operating the world's most extensive international parcel delivery networks - will be brought together with Airborne's domestic strength in the U.S. market. There, Airborne has a 18,8% share in the market for overnight delivery. Moreover, DPWN Group and its clients will benefit from the broad ground network, Airborne is running in the U.S. In 2002, Airborne delivered approximately 356 million domestic parcels.
Under the terms of the agreement, Airborne's airline related business will be separated first and will become an independent public company, called ABX Air, Inc. ABX Air will be owned by Airborne's current shareholders. Thereafter, DHL will acquire the remaining non-airline related activities for $US 21.25 per share in cash, or a total of approximately $US 1.05 billion. Both the new company and ABX Air will enter in a service agreement. The transaction, which is subject to shareholder and regulatory approvals and customary closing conditions, is expected to be completed during the summer of 2003.
Dr. Klaus Zumwinkel, Chairman of DPWN's Management Board, said: "We are going to combine the importance of the world's market leader DHL with the strength of Airborne in the U.S. That's how we create a strong No. 3 in the large and profitable U.S. market. Our clients will benefit from a unique presence in the U.S., in Europe and in Asia."
The combined company will operate under the DHL brand and will be managed by Carl Donaway, current Chairman and CEO of Airborne, leading a management team from both Airborne and DHL.
For further information regarding the transaction: www.dhlairborne.com