THE HAGUE (AFP) -- U.S. express delivery giant United Parcel Service made a bold move to strengthen its position in Europe and the world on Monday, saying it would pay 5.16 billion euros ($6.77 billion) for Dutch firm TNT Express.

The deal is expected to put UPS ahead of rivals DHL and FedEx, which would be "outgunned" should it made any counter-offer, an analyst said.

The companies said in statements: "The transaction will recreate a global leader in the logistics industry with more than 45 billion euros in annual revenues and an enhanced, integrated global network."

They said: "The Executive and Supervisory Boards of TNT Express unanimously intend to support and recommend the offer."

TNT Express, based in Hoofddorp outside Amsterdam, is a global player operating in more than 200 countries.

UPS, headquartered in Atlanta, Georgia, is the world's biggest package-shipping group with annual revenues last year of $53.1 billion and 400,000 employees.

To tie-up the deal UPS raised its initial unsolicited offer from 4.9 billion euros in mid-February

TNT Express posted a loss of 270 million euros last year which it blamed on restructuring costs. The latest offer represents a premium of 53.7 percent to the share price before takeover talks became public.

The takeover is based on an all-cash offer amounting to 9.5 euros per ordinary share. The price of shares in the target rose by 1.46 percent to 9.48 euros per share in mid-morning trading on the Amsterdam Stock Exchange (AEX).

The deal also had the support of TNT Express' biggest shareholder, Post NL which owns 29 percent and stands to raise 1.54 billion euros through the deal, the statement said.

UPS and TNT Express said they hoped that the new entity would achieve annual cost savings of 400-550 million euros within four years.

UPS said: "Service lies at the heart of this proposed transaction.

Customers will have access to deeper product capabilities and broader reach through the expanded geographies served."

Analysts said the acquisition was a breakthrough for the US-based UPS in the European market.

Figures released in 2010 gave UPS only 7.7 percent of the express postal service share against TNT's 9.6 percent and FedEx's 3.3 percent and DHL (Deutsche Post), with the largest slice of 17.6 percent of the market.

"With UPS' acquisition of TNT, it (UPS) has found an economy of scale and will become number one in Europe, leaving behind DHL and FedEx," said Maarten Bakker, an analyst with ABN Amro.

He added should a counter-offer be made by UPS' main rival FedEx, it would just raise its offer and "FedEx will be outgunned."

Last month TNT Express said it had rejected a 4.9 billion euro ($6.4 billion) unsolicited offer by UPS, a US-based parcel and logistics giant, but remained in discussions.

The deal, which still needs approval from competition authorities, will result in the group's combined revenue generated outside the United States jumping to 36 percent of the total, UPS said.

It "underlined UPS' longstanding commitment to Europe, where it has maintained a presence since 1976" and "enhances UPS's existing position in fast growing regions such as Asia-Pacific and Latin America".