In This Article:
Royal Mail’s sale to Czech billionaire Daniel Kretinsky has been cleared by the Government, paving the way for the more than 500-year-old postal service to pass into foreign ownership for the first time.
Business Secretary Jonathan Reynolds confirmed the Government had secured a raft of legally binding commitments with Mr Kretinsky’s EP 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 and International Distribution Services agreed to a deal worth £3.6 billion – or £5.3 billion including debt – in May but had been waiting for approval from the Government, which must sanction the takeover given the national importance of Royal Mail and the postal service in the UK.
Mr Kretinsky – nicknamed the Czech sphinx – has since made several further concessions to gain approval, including giving the Government a “golden share” in the postal service, meaning it will need to approve any key changes to Royal Mail’s ownership, headquarters location and tax residency.
Mr Reynolds hailed the proposed takeover as being beneficial for the UK, Royal Mail workers and customers.
He said: “This would be a good deal for the UK, be a good deal for the people who work for Royal Mail, and, of course, would be a good deal for the customers.”
He added: “We have negotiated something which secures the long-term future of Royal Mail and gives it the fresh start that we need.
“If this takeover goes ahead, we’re going to be in a stronger position than we otherwise would have been.”
Mr Kretinsky said they had worked to ensure “unprecedented commitments and undertakings that demonstrate the high regard EP Group has for Royal Mail as an institution, the service it provides to millions of UK homes and businesses, and Royal Mail employees”.
It sees the biggest hurdle overcome for the deal to go through, with the takeover now expected to complete early in 2025.
There were already a number of pledges made by Mr Kretinsky when the proposed deal was announced, including a vow to keep the brand name and retain Royal Mail’s HQ and tax residency in the UK for the next five years, as well as commitments to protect the company’s universal service obligations.
As part of the commitments, EP Group said it will also ensure that Royal Mail complies with regulatory conditions and that it will not undergo any changes to its corporate structure.
The group said that it had 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.