BBC sources predict Royal Mail takeover could be confirmed within two weeks
The sale of Royal Mail to Czech billionaire Daniel Křetínský’s EP Group is close to being finalised and could be confirmed in the next two weeks, the BBC has revealed.
In a story today, 28 November, the broadcaster said it understands from “sources close to the deal” that Daniel Křetínský has agreed to make extra concessions in order to clinch the takeover from parent company International Distribution Services.
EP Group declined to comment when contacted by the BBC, and it has contacted The Department For Business too, but unions have been meeting with the Czech businessman’s advisors this week – the Communication Workers Union (CWU) said these have been “constructive” – while some sources told the broadcaster they remain “wary”.
The billionaire has placed a total £5billion takeover bid for Royal Mail, which IDS accepted in May but it needs to be ratified by shareholders and the government had called it in for investigation, and will still have to be approved under the National Security & Investment Act.
It’s understood the guarantees offered in a bid to secure the deal include maintaining the one price goes anywhere in the UK universal service six days a week – although no information on whether this will be first or second-class has yet been revealed – and parcels Monday to Friday.
The so-called Czech Sphinx has also promised to keep the brand name and Royal Mail’s HQ and tax residency in the UK for the next five years, not to raid the pension surplus, and respect union demands for no compulsory redundancies until 2025.
It is thought additional safeguards may include extending the duration of these guarantees, and the BBC understands they have been sufficient to satisfy the UK government that Daniel Křetínský’ is a suitable owner for this 508-year-old British institution.
At a select committee meeting of MPs on Tuesday, 26 November, business secretary Jonathan Reynolds referred to him as a “legitimate business figure” and said the alleged links to Russia had already been examined and dismissed during the review by government officials when he became the biggest shareholder in the company last year.
Royal Mail, which reported a loss of £419million in 2023, and was fined £5.6m by industry watchdog Ofcom for missing delivery targets, is under fire for its stamp price increases – last month’s 22% price hike was the fifth increase in three years and roundly condemned by the greeting card industry as the annual inflation rate was just 2.9%, and means first-class letter postage has risen 117% in four years, while service levels have fallen.
Ofcom announced in September that, following its The Future Of The Postal Service review launched early this year, it was proposing cutting second-class deliveries on Saturdays and possibly to only alternate days, with an uncapped and unregulated price for sending letters first class meaning Royal Mail would still meet its USO, with the plans to be put to consultation before a final decision is made next summer, despite launching a probe into RM’s ongoing failure to meet its quality-of-service obligations.
The GCA is fighting to ensure the continuation of an affordable postal service, with its latest Use It Or Lose It direct action highlighting that second-class post anywhere in the UK is still only 85p, as greetings industry folk demonstrated at post boxes.
