Autumn 2006

Home delivery activities will inevitably be split to some extent following the high-profile disposal of TNT Logistics planned by its Dutch-based parent group, TNT nv.

TNT Logistics has steadily built up a presence in home deliveries in recent years, and customers include names like B&Q and Habitat. More recently it has created a specialist division, TNT Home, whose customers include retailers House of Fraser and The Pier and furniture manufacturer Scan-Thors (more on page xx).

TNT Express, the parcels operation that will be retained by the group, has not historically been a major player in home deliveries, but that position changed this year when its UK-based TNT Post business took over the courier delivery network of catalogue and online retailer JD Williams.

In practice, though, house-to-house mail-drop style deliveries typical of this operation differ from the dedicated or semi-dedicated home deliveries managed by TNT Logistics, so the sell-off may have little practical impact on operations.

Nick Wells, chief executive of TNT Post UK, described the Williams acquisition at the time as "a big development for us that propels us forward in terms of business growth and our position in the UK postal market." On that basis, it appears that the acquisition is seen as much in terms of the boost it gives the company's presence in the deregulated postal market as in any contribution to home shopping expertise.

TNT is selling the logistics business to Apollo Management for 1.48 billion euros, retaining a 5 per cent stake. A large proportion of the proceeds will be returned to shareholders.

The logistics business, said to be the second-largest in the world, employs 36,000 staff, and says it expects to consolidate its position, although analysts such as Datamonitor question how well equipped it will be to benefit from further expected industry consolidation.