FedEx Corp. Chairman, President, and CEO Frederick W. Smith today effectively ruled out any chance of countering rival UPS Inc.'s $6.8 billion buy-out offer for European parcel carrier TNT Express. Instead Smith said that FedEx has enough resources and momentum to succeed in Europe on its own.

Speaking to analysts as Memphis-based FedEx reported its fiscal year 2012 third quarter results, Smith said Europe remains a "big part of the FedEx network" and that the company is "confident in our plans to continue expansion, primarily through organic growth."

Smith said the European operations of its FedEx Express air and ground unit are "profitable" and "growing strongly."

Smith declined comment on any specific plans regarding TNT Express, citing corporate policy that forbids comment on what FedEx refers to as "corporate development matters."

Smith's comments may remove the one potential stumbling block keeping Atlanta-based UPS from completing the largest acquisition in its 105-year history. On Monday, UPS and Dutch-based TNT Express announced they had agreed on a $6.8 billion transaction, up $400 million from UPS' initial offer in mid-February. The addition of TNT will increase UPS' share of the intra-European parcel market, mostly for ground deliveries. It will also elevate UPS' footprint in Latin America and Asia-Pacific markets where TNT Express has a presence.

DHL Express, the market leader in Europe, has remained silent on the developments. Most observers believe DHL will stand aside for fear that a combination with TNT Express—which vies with DHL for parcel leadership in Europe—will draw the interest and the ire of European antitrust authorities.

Estimates of market share data vary depending on the source. Analysts at Milwaukee-based investment firm Robert W. Baird & Co. estimates that DHL has 38 percent of the intra-European parcel market, followed by UPS with 23 percent, TNT Express with 18 percent, and FedEx with 10 percent. St. Louis-based firm Stifel, Nicolaus & Co. estimates that TNT Express has about 18 percent of the market, followed by DHL with slightly less than that, UPS with about 10 percent, and others, including FedEx, comprising the balance. New York investment firm Wolfe Trahan & Co. said TNT leads with 18 percent of the intra-Europe market, followed by DHL with 16 percent, UPS with 14 percent, and FedEx with 10 percent.

The European parcel market is comprised of four categories: domestic intra-country, pan-European ground, intra-European air, and intercontinental air. Smith said that, unlike the U.S. shipping market, Europe is much more "fractionated," especially in domestic country markets which are heavily populated with mom-and-pop operators. Such an environment makes for tougher competition but also could help larger companies like FedEx gain share of a fragmented market.

Smith said FedEx remains strong in the intercontinental and the intra-European air segments. The company has added 23 European stations in the past five months and has positioned more freighters in Europe to provide later pick-ups and earlier deliveries to customers shipping within and outside the continent, according to company executives.

Smith also took time to assess Europe's growth rates, saying they "are extremely low, and they will continue to be extremely low" as long as the European Union (EU) pursues austerity measures rather than promoting pro-growth policies. Some may view these comments as a swipe at the timing of UPS' acquisition of TNT.

Smith said both the EU and the United States do not have policies that will stimulate gross domestic product (GDP) growth beyond the current subpar levels. Overall FedEx expects a continued sluggish economic recovery in the United States and abroad. It predicts a 2.1-percent U.S. GDP growth in 2012, followed by 2.4 percent in 2013. U.S. industrial production will grow by 3.9 percent, propelled by increased business investment and inventory replenishment, the company said.

FedEx expects global GDP to grow 2.3 percent in 2012, with growth in developed countries of 1.1 percent and growth in emerging markets of 5.2 percent. The company, whose economic forecasts are highly regarded because it ships such a large part of world GDP, revised its global forecast downward to account for the growing possibility of recession in the Euro zone.