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United Parcel Service Inc. (UPS) is suing the European Union (EU) 1.7 billion euros ($2.1 billion) as a compensation for the damage it had suffered. The main reason for this legal action was due to EU’s regulators wrongly vetoed UPS’ attempt of TNT bid. The compensation includes interest and taxes UPS would have to unexpectedly pay.
As mentioned in the court filing, UPS wants to return to its glory before the whole ordeal happened. With the deal wrongly dismissed, UPS could not gain any benefits that they had expected to gain. EU courts are being called upon to meticulously inspect the commission’s powers. Firms are also fighting EU’s decisions to open probes, how they agree on concessions with companies, and their focus in a merger review.
UPS believes that the compensation requested is the right value to the opportunity wrongly disallowed by EU. According to UPS, the EU changed its economic analysis of a UPS-TNT deal without UPS’ knowledge. Until the commission’s appeal is concluded, the court will then make a decision to consider each case in parallel or delay a decision on UPS’ damages claim. The final decision will likely take years to make.
The UPS is not the only company that is involved in a controversy with EU. Previously, Royal KPN NV and HeidelbergCement AG were among the few that were involved in court challenges with EU. With such cases, it puts EU under a negative light as its reliability is now being questioned.
The UPS and TNT deal made in 2013 is a troubling one that could create an almost monopoly in Europe; although they still had DHL to contend with. However, EU commission causes it to be a lost deal. Mega merger and acquisition deals are decreasing in numbers despite a few potentials being open in the market. It seems that merger and acquisition is the best choice for corporate growth. We could witness at least 1 to 2 mega deals in 2018.