* UPS will be told of EU worries on Tuesday
* EU Commission will send statement of objections shortly
(Adds second source, UPS comment)
By Gilbert Kreijger and Foo Yun Chee
AMSTERDAM/BRUSSELS, Oct 10 (Reuters) - EU antitrustregulators will next week tell United Parcel Service Incthat its bid for TNT Express will hurt competition,two sources close to the matter said, forcing the U.S. companyto offer concessions or risk a veto.
The European Commission, which is examining the5.2-billion-euro ($6.71 billion) deal, will set out its concernsat a meeting with UPS officials on Tuesday before sending astatement of objections or charge sheet, the people said onWednesday.
One of the sources said UPS had not offered any concessionsto date, preferring to wait until the EU watchdog detailed thepotential problems.
Shares in Dutch delivery group TNT Express endedunchanged at 8.15 euros on Wednesday. The stock fell as much as2.5 percent in early trading after the Financial Times reportedthat the EU watchdog would object to the deal.
TNT Express shares have been trading below 9 euros since theend of July, compared with UPS' bid of 9.50 euros per share.
UPS may find it difficult to make concessions to sootheregulatory concerns about the deal, the biggest in its 105-yearhistory, said Andre Mulder, an analyst with brokerage Kepler.
"We think the likelihood of the takeover being cancelled hasincreased a bit further," he wrote in a note.
UPS said it would continue to work with the Commission. "Weare confident the deal will go through," a UPS spokesman said.
The Commission is worried that the proposed merger willreduce the number of players, leaving the combined entity tocompete with only Deutsche Post's DHL and U.S. peerFedEx .
UPS is arguing that it faces competition from nationalpostal companies such as French mail company DPD and RoyalMail's European express parcel service GLS, as well asfreight forwarders like Swiss companies Kuehne & Nageland Panalpina .
Analysts said the merged company's strong market share inBritain, Italy and the Netherlands and TNT's dominance in theintra-Europe express market may mean it has to make concessionsin these areas.
The Commission has set a Jan. 15 deadline for its decision.($1 = 0.7751 euros)
(Reporting by Gilbert Kreijger and Foo Yun Chee; Editing byHans-Juergen Peters and Helen Massy-Beresford)
Keywords: TNTEXPRESS UPS/