Shares in private postal company UK Mail leapt over 40 per cent this morning after its board announced it had a agreed terms for a takeover by Deutsche Post.
The deal values the FTSE-listed company at £243m and the cash offer of 440p a share represented a 43 per cent premium to yesterday's closing price.
Read more: More packages but less profit at UK Mail
UK Mail's chief executive Peter Kane said that the deal gave the opportunity for shareholders to realise their investment and explained the logic behind the takeover for the business going forward:
The Board believes that UK Mail will benefit significantly from becoming part of Deutsche Post DHL, and will be better positioned to continue to develop our parcels and mail businesses with the benefit of Deutsche Post DHL's greater financial and operational resources.
Jurgen Gerdes of Deutsche Post said that the growth e-commerce across Europe continues to drive increased demand for cross-border deliveries. He said:
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. With this acquisition, we will further extend our network and have a strong foothold in Europe's three largest e-commerce markets, the United Kingdom, Germany and France
Originally branded as Business Post, it listed in 1993 and grew following its name change to UK Mail in 2003 subsequently winning significant contracts with large business customers such as Powergen in 2004.
Deutsche Post – which also owns DHL and is the largest courier in the world – said that it had already received undertakings from 60 per cent of shareholders to agree to the sale.
Nevertheless, a shareholder vote would be needed to rubber-stamp the deal as well as sign-off from European Commission competition authorities.