The European Commission on Friday, July 20, opened an in-depth probe into United Parcel Service Inc.'s €5.16 billion ($6.28 billion) pursuit of TNT Express NV, citing concerns about competition in "numerous" European countries.

In particular, regulators said that the deal will combine two of only four companies controlling a comprehensive air and road small-package delivery network in Europe. The other two players are Deutsche Post AG's DHL Express and Memphis-based FedEx Corp.

"The small-package delivery sector is of strategic importance for various other industries in Europe," European Union Competition Commissioner Joaquín Almunia said in a statement. "The proposed acquisition could in particular reduce competition for the provision of the fastest express delivery services, to the detriment of direct customers and ultimately of European consumers."

He added: "The Commission needs to make sure that customers continue to have access to these services at competitive conditions."

The case is one of six so-called Phase 2 probes under way in Brussels. The Commission is also scrutinizing United Technologies Corp.'s $16.5 billion purchase of Goodrich Corp., with a final decision due Aug. 31; and regulators are examining Vivendi SA-owned Universal Music Group's £1.2 billion ($1.8 billion) pursuit of EMI Group Ltd.'s recorded-music business, with a deadline for ruling by Sept. 6.

During their initial investigation of the UPS-TNT deal, watchdogs found that the tie-up would create a "highly concentrated market" for international and, to a lesser extent, domestic express delivery services in several member states.

Regulators have given themselves until Nov. 28 to examine the deal, which was notified in Brussels on June 15.

Friday's announcement comes a week after the companies announced that they expect to complete the deal in the fourth quarter amid an expected in-depth probe in Europe. It also comes amid unconfirmed reports that Belgium's Wallonian region is weighing buying a stake in TNT Airways, which has its cargo hub in the eastern town of Liege.

Should the UPS transaction fall through on competition grounds, the stakes are high for TNT, which will have to pay UPS a €200 million reverse breakup fee.

If the deal goes through, the purchase would represent the largest ever in the 105-year history of the Atlanta-based buyer.

The deal was agreed in March after UPS raised its bid by 5.6%, to €9.50 a share from €9 a share, offering a nearly 54% premium to the target's close Feb. 16, the day before the companies revealed they were in talks. On Friday, TNT shares closed down 0.48% on the Euronext Amsterdam exchange at just above the original €9 a share offer price.

Linking UPS and TNT would combine the second- and third-largest high-speed parcel delivery companies in Europe with a combined market share of 39%, overtaking the 37% share of DHL Express, which is also the global leader. The enlarged entity would pull in annual revenue of more than €45 billion.