PartnerShip: News: FedEx to Acquire Kinko's

Shipping News

FedEx to Acquire Kinko's; Expands Global Presence

FedEx's full range of shipping services will now be offered in all Kinko's stores

December 30, 2003

MEMPHIS, Tenn., Dec. 30, 2003 - FedEx Corporation and Clayton, Dubilier & Rice, Inc., today jointly announced an agreement for FedEx to acquire Kinko's for $2.4 billion, payable in cash. The transaction is not expected to have a material impact on fiscal 2004 results but is expected to be accretive to earnings in fiscal 2005, which begins June 1, 2004.

"The FedEx and Kinko's combination will substantially increase our retail presence worldwide and will enable both companies to take advantage of growth opportunities in the fast-moving digital economy," said Frederick W. Smith, chairman, president and chief executive officer of FedEx Corp. "Our two companies share a similar background, culture and customer focus, and that common ground is extremely important as we prepare for future growth and success."

The transaction is expected to close in the first calendar quarter of 2004.

Global Retail Presence

All 1,200 Kinko's locations worldwide - including more than 400 that operate 24 hours a day, seven days a week - will offer new or expanded FedEx shipping options for greater customer convenience.

As Kinko's exclusive shipping provider since 1988, FedEx currently operates full-service, staffed counters in 134 Kinko's stores, accepting both time-definite express and day-definite ground shipments. This full range of shipping services will now be offered in all Kinko's stores, greatly increasing FedEx Ground retail access in the United States and Canada, and improving the retail presence for FedEx Express in key international markets.

Kinko's plans to significantly expand from about 110 current international locations, concentrating on growth opportunities in Asia, North America and Europe. FedEx, which serves 215 countries worldwide, will use its global expertise to support Kinko's strategic expansion.

Diversified Customer Base

Together, FedEx and Kinko's will broaden their reach to important customer segments.

Small to medium businesses: Kinko's is a magnet for small- to medium-sized businesses that rely on the retailer worldwide for copying, printing, computer usage and other basic office needs. Together, FedEx and Kinko's will offer a full-service portfolio - backed by the resources of a $23 billion corporation, but with a network of local Kinko's stores to tailor solutions for individual customer needs.

Corporate services: Large customers turn to Kinko's to outsource copying, printing and document management services, just as many of the same corporations turn to FedEx to help streamline their global supply chains. In both cases, corporate customers save time, save money and increase efficiency. Together, FedEx and Kinko's will create a broader range of high-end corporate solutions, with physical and virtual connections to the global marketplace.

"This combination will give customers large and small a single 'go-to' resource for a wider range of business needs," said T. Michael Glenn, FedEx Corp. executive vice president of market development and corporate communications. "Together, we can build our retail relationship with small businesses, design more complete business solutions for our large corporate customers, and create a stronger support structure for the increasing number of mobile professionals."

Kinko's provides an "office on the road" for traveling business professionals and remote workers, who often need high-speed Internet access, videoconferencing, presentation support and other business services. Kinko's also provides a virtual link between the mobile professional and a library of corporate documents, like sales presentations and marketing materials, which can be stored securely online and printed on demand.

About FedEx

With annual revenues of $23 billion, FedEx Corp. is the premier global provider of transportation, e-commerce and supply chain management services. The company offers integrated business solutions through a network of subsidiaries operating independently, including: FedEx Express, the world's largest express transportation company; FedEx Ground, North America's second largest provider of small-package ground delivery service; FedEx Freight, the largest U.S. provider of regional less-than-truckload freight services; FedEx Custom Critical, North America's largest provider of expedited time-critical shipments; and FedEx Trade Networks, North America's largest customs broker and a provider of international freight forwarding and trade facilitation services. FedEx ranked highest in the J.D. Power and Associates 2002 Small Package Delivery Service Business Customer Satisfaction Study^SM in the categories of air, ground and international delivery services. For more information, please visit fedex.com.