Royal Mail takeover by Czech billionaire given Government approval
The deal between Kretinsky and Royal Mail’s parent company is £3.6 billion, but rises to £5.3 billion including debt, ITV News Business and Economics Editor Joel Hills reports
The sale of Royal Mail’s parent company to a Czech billionaire has been approved by the Government putting the postal service into foreign ownership for the first time.
The takeover by Daniel Kretinsky’s EP Group from current owner International Distribution Services was confirmed by Business Secretary Jonathan Reynolds on Monday morning.
He said the takeover was secured along with legally binding commitments with Mr Kretinsky’s EPH Group over the postal service, including protecting the one-price-goes-anywhere delivery commitment and a pledge to keep Royal Mail headquartered in the UK.
Mr Kretinsky is believed to have made several other concessions to gain approval, including allowing workers to get a 10% share of any dividends paid out to him and giving the Government a “golden share” in the postal service.
He also committed not to raid the pensions surplus, to maintain the universal service and the brand name, plus to keep tax residency in the UK for five years.
Mr Reynolds said: “For too many years progress on securing a stable future at Royal Mail has stalled, but from day one we have been committed to providing a secure future for thousands of workers and customers.”
He added the agreements reached with EPH Group showed “we are working towards ensuring a financially stable Royal Mail with protected links between communities other providers can’t reach”.
The deal between Kretinsky and Royal Mail’s parent company is £3.6 billion – or £5.3 billion including debt.
EPH has also reached an agreement to recognise and negotiate with the unions representing Royal Mail’s frontline staff and managers – the Communication Workers Union (CWE) and Unite respectively – for at least the next five years.
Unions are reported to have been pushing for further assurances and for the commitment over compulsory redundancies to be extended.
On Friday, Royal Mail was fined £10.5 million by regulator Ofcom for missing its post-delivery targets in the 2023-2024 financial year.
The watchdog said just under three-quarters of first class post was delivered on time during the period, well short of its 93% target, and 92.7% of second-class post was delivered on time, below its 98.5% target.
The fine is the second in two years after the watchdog also gave Royal Mail a £5.6 million penalty in November 2023.
Subscribe free to our weekly newsletter for exclusive and original coverage from ITV News. Direct to your inbox every Friday morning.
Have you heard The Trapped? Listen as Daniel Hewitt exposes the UK's dirty secret.