Apollo pays €1.48bn for TNT unit

Dutch transport and distribution group TNT has agreed to sell its logistics division to US-based buyout firm Apollo Management. The total transaction value is €1.48bn (US$1.9bn) on a cash and debt free basis.

TNT intends to return most of the net proceeds, which are estimated at between €1.2bn and €1.3bn, to its shareholders by way of a share repurchase programme with a value of up to €1bn. The intended sale is part of TNT’s “Focus” strategy, in which the company announced on December 6 last year that it would focus on its core competency of managing delivery networks.

The intended sale is subject to approval by TNT shareholders and the customary approval of EU and other regulatory bodies. The company’s central works council is understood to have approved the transaction. Completion is expected before year-end.

After completion of the transaction, Dave Kulik will resign from the TNT board of management to become CEO of the new company.

Gareth Turner, a London based Partner at Apollo Management, said: “As long-term investor, Apollo Management looks forward to helping the logistics division to further build its top position in the contract logistics market worldwide.”

The logistics division is the number two logistics company in the world, employing about 36,000 people.

Apollo’s current and past investments in the distribution, transportation and logistics industries include Pacer International, Quality Distribution and Metals USA.

Goldman Sachs advised TNT on the sale.