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Logistics arm no longer central to TNT business activities

Company rethinks corporate strategy


Tags: Excerpts from the Windmill

AMSTERDAM - Dutch firm TNT wants to sell its logistics arm in order to focus on its mail and parcel delivery endeavours. It plans to sell the $4 billion business early this year, pending shareholder approval.

TNT is looking to expand its mail delivery and distribution business into new markets, taking advantage of increased deregulation of the industry. TNT, which has 160,000 staff worldwide, is in talks to buy companies in China and Spain.

After conducting a strategic review, TNT said it had decided that its logistics arm was no longer a "core" business. The division is a leading supplier of distribution services to the car, electronics and pharmaceutical industries. It also played a key role in delivering emergency relief aid to disaster stricken regions such as Pakistan and the Southeast Asia tsunami.

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Chief executive Peter Bakker says TNTís logistics business is a strong operation with a talented group of employees and good customer relationships but will no longer fit with its strategic focus going forward. The exit of logistics will allow TNT to simplify its organization.

TNT is lining up two deals to boost its international mail delivery operations. It is in talks to buy Hoau, China's largest freight and parcels operator and TG+, a Spanish express delivery firm.

TNT also plans to return over $1.1 billion to shareholders through a share buyback program.

Founded in Australia in 1946, TNT was acquired by the Dutch postal group KPN in 1996. It now listed as a separate entity on the Amsterdam stock exchange.