‘Czech Sphinx’ moves closer to £3.57bn Royal Mail deal

royal mail 2A £3.57bn takeover of Royal Mail by Daniel Křetínský has inched ever close after parent company International Distributions Services (IDS) said it had accepted a cash offer from the Czech billionaire’s EP Group.

The deal will see Křetínský cough up 360p a share for the 73% of the company he does not already own, although IDS shares rose by 3% to 331p when markets opened – a figure that is well below EP’s offer – fuelling claims the market remains unconvinced the deal will go through.

In fact, the takeover still needs to be rubberstamped by IDS shareholders at the annual general meeting on September 25 and could still be blocked by the Government under the National Security & Investment Act.

Labour, which is forecast to form the next Government after the General Election, welcomed the assurances given by Křetínský and said the party would ensure they were adhered to if it won power.

The proposed undertakings and contractual commitments with the Government and unions include retaining Royal Mail’s proposals for the Universal Service for a first-class postal service to anywhere in the country for a fixed price six days a week for a period of at least five years. IDS has suggested second-class post could go to every other weekday.

There is also a commitment to maintain base salaries and benefits for staff for at least two years, while there would be no changes to Royal Mail’s branding or ownership for three years and it would keep its HQ and tax residency in the UK.

EP also said it does not intend to make any material changes to the overall headcount or reduce the number of frontline workers, and will speak to unions about extending the current agreement of no compulsory redundancies past April 2025.

Royal Mail’s largest union, the Communication Workers Union, said it would meet Křetínský – who has been dubbed the “Czech Sphinx” because of his reluctance to speak in public – to seek a reset in employee and industrial relations and further commitments on the future of the company.

CWU’s general secretary, Dave Ward said: “We’ll be looking for pension guarantees, we’ll be looking for a stake for the employees in the future ownership model of the business.

“I think it’s about testing Křetínský as to whether he’s got any plans for investing in the workforce and investing in growth strategies for the company, or whether his intentions are purely to asset strip the company.”

Related stories
Why Royal Mail price rises don’t do anyone any favours
Industry fears client cutbacks over direct mail price rise
Watson: Push the envelope to fight ad mail price hike
Direct marketing shines again as spring brings recovery
Spooner on…a love letter to the humble direct mailshot
Direct marketing hits 20-year high in upbeat Bellwether
Deluge of emails sees Brits long for return of direct mail

Print Friendly