German giant Deutsche Post wraps up £242.7m takeover of UK Mail
Deutsche Post has struck a deal to acquire UK Mail for £242.7 million, a move that will see it go parcel to parcel with Royal Mail.
The German postal giant said on Wednesday that it is snapping up UK Mail as part of a European expansion drive.
Deutsche Post board member Jurgen Gerdes said: "The ongoing expansion of our parcel network in Europe is driven by increasing demand within our e-commerce customer base for cross-border deliveries."
"UK Mail is a well-run business and an established provider of quality delivery services in the UK and offers a complementary fit with our integrated offering."
UK Mail was dogged by technical problems at a new sorting centre last year which meant bulky parcels had to be handled manually, resulting in higher costs that ate into profits.
The tie-up will see UK Mail shareholders receive 440p a share in cash and the offer assumes that they will also be entitled to receive an interim dividend of 5.5 pence per UK Mail share.
UK Mail directors are advising shareholders to vote in favour of the deal as they deem it "fair and reasonable".