Fred Smith
👤 SpeakerAppearances Over Time
Podcast Appearances
But there was another reason Smith wanted tigers and one that kept him up at night, fear.
Fred was afraid somebody like UPS was going to come in and buy it.
And if UPS got those international routes, FedEx would be boxed into America forever.
So in November of 1988, he made his move.
He offered $20.88 a share, $880 million total, $6 above the market price.
Take it or leave it.
They took it.
Wall Street loved the deal, at least initially.
FedEx stock jumped 10 points.
Smith had just bought a global network overnight.
And then reality hits.
The Tigers fleet was a disaster.
Many of the 747s barely met FAA requirements.
So FedEx would go on to spend another $100 million just making them airworthy.
But the planes were fixable and the pilots weren't.
Tiger pilots were unionized with strict seniority rights.
FedEx pilots weren't.
Smith had promised his pilots that nothing would disturb their seniority system.
And now he had to merge two pilot groups.
Someone had to lose.