(Updates with details, background)
AMSTERDAM, Feb 25 (Reuters) - The Netherlands’ largest mail carrier PostNL plans to buy its main rival Sandd for an estimated 130 million euros ($147.49 million) in cash and assumed debt, it said on Monday.
The deal, if approved by regulators, would combine the two largest mail companies in the country. PostNL employs 18,000 delivery staff and delivers 1.78 billion letters annually, compared with 16,000 delivery staff at Sandd and 720 million letters.
PostNL rejected a 5.75 euro per share takeover offer from Belgium’s Bpost in December 2016. PostNL shares closed at 2.277 euros on Friday.
PostNL has struggled to keep its declining mail business profitable while fulfilling its obligation to deliver to all parts of the country, and has frequently clashed with regulators over obligations to carry competitors’ mail on its network. Sandd is known mostly for delivering bulk mail and mostly in the country’s urban areas.
If the Sandd merger proceeds, the companies expect cost savings of 50-60 million euros, they said in a joint statement. On Monday PostNL reported full year profit of 33 million euros, down from 148 million euros a year ago.
In an outlook for 2019, PostNL said that, excluding the merger, it expects growth in its parcel business to offset mail declines, and sales to grow by 3-5 percent. It forecast underlying profit cash operating income of 170-200 million euros but did not give a net profit forecast.
However it warned current plans by the Authority for Consumers & Markets (ACM) on allowing competitors access to its network for overnight business mail would reduce 2019 operating income by 50-70 million euros.
$1 = 0.8814 euros Reporting by Toby Sterling in Amsterdam and Joseph Birch in Gdynia; Editing by Rashmi Aich