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DHL Worldwide Express and Airborne Inc. are making no bones about it; they are going after UPS and FedEx as a result of a definitive merger agreement that DHL and Airborne announced on March 25. This merger aims to provide a stronger third competitor in the U.S. express delivery market, currently dominated by UPS and FedEx.
Under the terms of this new deal, DHL will acquire Airborne's ground operations for $21.25 per share in cash, which has a total equity value of approximately $1.05 billion. Upon completion of the deal, Airborne's air operations will be separated from its ground operations and will become an independent public company called ABX Air Inc. This new entity will be wholly owned by current Airborne shareholders, who will receive one ABX Air share for each Airborne share they currently hold.
The combined U.S. ground operations of Airborne and DHL will operate under the DHL brand. This deal, which is subject to shareholder and regulatory approval, is expected to be completed during the summer of 2003.
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