UPS cancels purchase of Estafeta – Mexico business deal

UPS has officially withdrawn its previous plan to buy Estafeta, a prominent Mexican logistics and express delivery company. The decision was disclosed in a Form 8-K filed with the US Securities and Exchange Commission (SEC) on September 17 by Brian Dykes, UPS’s Executive Vice President and Chief Financial Officer.

According to UPS, the cancellation was due to the fact that not all closing conditions could be met. Estafeta echoed this sentiment in a statement, confirming that the sale to UPS was terminated as the two parties could not come to an agreement on final closing terms. Despite the failed acquisition, Estafeta remains committed to its customers and expressed its dedication to providing top-notch logistics services, ensuring operational continuity, and fostering strong relationships with its customers and partners.

The termination of the acquisition deal comes after over a year since UPS announced its intention to acquire Estafeta in June 2024. The acquisition had been expected to be finalized by the end of 2024 pending customary closing conditions and regulatory approvals. UPS had viewed acquiring Estafeta as a strategic move to reinforce its presence in Mexico and enable businesses of all sizes to leverage the country’s manufacturing growth, the evolution of global supply chains, and the expansion of North American trade.

As a result of this development, UPS has decided to postpone its anniversary event in Mexico, which was scheduled to be held on September 24.

Both UPS and Estafeta are pivotal players in the logistics industry, with UPS being forced to realign its regional growth strategy following the cancellation of the acquisition deal. Estafeta, on the other hand, will continue to operate independently and maintain its position as a key player in the Mexican logistics sector.

UPS Mexico has refrained from commenting on the matter despite requests for statements from Mexico Business.

The cancellation of the acquisition marks a significant shift in UPS’s strategic plans for growth in the region as Estafeta remains steadfast in its commitment to the Mexican market. The terminated deal highlights the complexities and challenges involved in large-scale acquisitions in the logistics industry.