Will European Regulators Approve FedEx's Acquisition Of TNT Express?
Joel Elconin is the co-host of Benzinga's #PreMarket Prep, a daily trading idea radio show.
FedEx Corporation (NYSE: FDX) shares are trading higher by $4.48 at $171.15 in Tuesday's session. That is the good news for shareholders, but the bad news is that the issue has retreated sharply off its pre-market high ($176.39).
The catalyst for the rally was the announcement by the company that it is acquiring TNT Express (Netherlands-based courier company). The move is aimed to expand the company's portfolio of international transportation solutions and to keep pace with continuing growth of global e-commerce.
FedEx, which had been wallowing at the $165 level and was on the verge of a major technical breakdown, took flight off the announcement sprinting to $176.39 before profit-takers flooded the issue. By the opening of the regular session, it had retreated to the $173 level and after a brief pop to $173.84, it has headed straight down.
At this time, FedEx has found some intraday support at $171.07, but has not been able to distance itself from that level.
Of note, the takeover comes less than two years after a bid for the company by United Parcel Service, Inc. (NYSE: UPS) was blocked.
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