The European Commission opened an in-depth probe into the deal in July, citing concerns about competition in "numerous" European countries by combining two of only four large companies controlling air and road small-package delivery in Europe.
The others are European market leader Deutsche Post AG's DHL Express and Memphis-based FedEx Corp.
After failing to persuade watchdogs to take a broader view of the market and consider other smaller players, UPS and TNT said they have offered to sell activities and assets as well as grant access to air networks.
"The proposed remedies aim to address the EC's concerns regarding the competitive effects of the intended merger on the international small express package market in Europe," the companies said in a statement Thursday, after meeting a midnight deadline for filing remedies.
"UPS and TNT Express continue to be fully committed to the merger," they added, "and are working closely with the EC in order to gain competition clearance allowing completion of the transaction in early 2013."
On Friday morning in Amsterdam, TNT shares gained 1.1% to trade at €7.65, still well below UPS's €9.50 per share offer price.
The companies did not specify the assets they plan to put up for sale or whether they have identified potential buyers, leaving it to the Commission to market-test the remedies with competitors. In a recent speech, EU competition chief Joaquín Almunia said the deal may require "substantial remedies" to gain approval.
UPS and TNT recently extended their offer to Feb. 28, about a week after expected clearances in Brussels and China. TNT agreed earlier this month to sell its air operations to ASL Aviation Group for an undisclosed amount, in order to meet EU rules on foreign ownership rules after the UPS takeover.
In accordance with EU merger rules, the Commission is expected to extend the deadline for its decision by 15 business days to Feb. 5, following the remedies offer.
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 undisturbed share 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.
The companies said in Friday's statement that their merger will create a more efficient logistics market by offering consumers a broader portfolio of services and better global access, along with lower overall supply-chain costs and improved service.
Dechert LLP hired funds attorney Asma Chandani as counsel in Los Angeles. For other updates launch today's Movers & shakers slideshow.
The target indicated, however, that if its antitrust concerns were addressed, it might be willing to engage in talks and allow due dilligence, which its agreement with Dollar Tree allows. More video