Netherlands-based TNT Express NV (AMS:TNTE) is throwing in the towel on its Brazilian and Chinese operations and letting go of 4,000 people over the next three years after competitor United Parcel Service, Inc. (NYSE:UPS) of Atlanta, Ga., the world’s largest package deliverer, failed to win approval from European regulators for its $6.7 billion takeover bid of TNT.
Citing “challenging trading conditions and continuing price pressure,” TNT said the moves are aimed at generating €220 million ($283.4 million) in savings by 2015. The layoffs amount to about 6 percent of the company’s workforce.
"The business we have is the business we have, in terms of its geographic scope, and that's where we are going to focus, improve and try to get the best possible margins," Bernard Bot, interim chief executive, told journalists in a conference call. "But yes, we also have to accept that we are a cyclical stock and are to some extent dependent on the economic development."
The economic downturn in Europe has led to a 15 percent drop in business in the region, the company said. Bot will return to his position as chief financial officer once Tex Gunning takes over. According to a company release announcing the management changes, Gunning managed a successful turnaround of Dutch paints, coatings and specialty chemical manufacturer Akzo Nobel NV’s (AMS:AKZA) North American operations of its Decorative Paints unit.
UPS announced on Jan. 14 that it was scrapping its effort to buy the Dutch company, which has an air hub in Liege, Belgium, with a fleet of 52 aircraft.