Dutch mail group PostNL is considering a one-off special dividend or share buyback after the sale of its stake in TNT Express to United Parcel Service, a PostNL official said.
The mail group, which scrapped cash dividend payouts during years of painful restructuring, will make roughly 1.5 billion euros ($1.98 billion) divesting its 29.8 percent holding.
UPS on March 19 agreed to buy the express mail service for 5.2 billion euros, its largest-ever acquisition and a deal that will make it a leader in the European package delivery market.
Cees Visser, head of investor relations at PostNL, told Reuters that the stake sale proceeds will first go towards paying off 700 million euros in debt. The company will use 300 million euros to reinstate a cash dividend for 2012 and 2013 and a further 300 million to invest in operations outside the Netherlands, leaving roughly 200 million euros to spend on one-off measures, he said. "If there is money left over a special dividend or a share buyback is possible," Visser told Reuters.
PostNL, which has been suffering from declining mail volumes in its core European markets since 2000, switched from a cash dividend to a dividend in shares after writing down around 700 million euros on its stake in TNT Express.
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