The acquisition agreement marks a logical extension of a successful business relationship that dates to 1990, when UPS first offered its service to customers in Romania through Romtrans SA, TCS's parent company. TCS has been UPS's authorized service contractor in Romania since it was founded as a separate entity in 2000.
UPS expects to complete the transaction in the second quarter of 2008, subject to customary closing conditions. Terms of the deal were not disclosed.
As a result of the acquisition, UPS in Romania will be able to solidify its premium service offering to customers and improve its already high levels of service quality in one of the fastest-growing economies in the EU*.
"This agreement opens a wealth of opportunity for UPS customers seeking to do business to and from Romania," said Wolfgang Flick, president, UPS Europe. "With direct control of our own network, UPS will have the flexibility it needs to expand operations and to invest in infrastructure, technology, brand presence and employee development. And our customers will have the confidence of knowing we can stay ahead of demand in a country that's growing GDP at almost three times the EU average."
The Bucharest-based TCS has been UPS's service provider in Romania, offering customers a suite of international delivery services through a strong nationwide network backed by advanced shipping systems and technology as well as an experienced workforce. TCS's customers include some of the most recognized brands in Romania across a broad range of industries. TCS operates facilities in Bucharest, Timisoara and Constanta and connects to UPS's global network with a flight operating between Bucharest and Cologne every weekday.
"This acquisition is an ideal strategic and operational fit for UPS," added Flick. "Romania is clearly one of the most dynamic economies in Europe, especially since joining the EU last year, and we are delighted with the progression of our business in this key southeastern European nation. In addition, we are very pleased to welcome the more than 100 hard-working TCS employees into the UPS family, which is already 40,000 strong across Europe."
UPS has enjoyed solid growth in Romania over the years and in 2007 recorded a 10% gain in export volume growth compared to the prior year.
