Daniel Křetínský

Czech Billionaire Eyes Acquisition of Royal Mail Amid Concerns

The historic Royal Mail, dating back to the Tudor era, is on the verge of being acquired by Czech billionaire Daniel Křetínský, raising concerns about the future of thousands of workers and a crucial national service.

International Distribution Services (IDS), which owns the financially struggling Royal Mail, announced on Wednesday its intention to recommend a £3.70-per-share ($4.69) takeover offer from Křetínský’s EP Group to its shareholders. The EP Group has until May 29 to finalize its £3.5 billion ($4.4 billion) non-binding offer into a formal bid for IDS.

Royal Mail, privatized in 2013, has faced a steep decline in demand and mounting losses. Appeals to the UK government to reduce its obligation to deliver letters six days a week have been ignored. A spokesperson for the UK Department for Business and Trade told CNN there are “no current plans” to alter Royal Mail’s service obligations, stressing any future changes must consider the impacts on businesses and vulnerable consumers.

Křetínský, a Czech national with an estimated net worth of $7.7 billion according to the Bloomberg Billionaires Index, has built a vast empire across European energy, retail, and sports sectors. Known for his discreet business approach, he has been dubbed the “Czech Sphinx.” He co-founded EPH, a major player in European gas and coal power, and later established EP Group, which holds stakes in notable brands like Foot Locker and Sainsbury’s.

In 2021, Křetínský acquired a 27% stake in West Ham United Football Club, making him the second-largest shareholder. His potential acquisition of Royal Mail, however, has sparked fears about foreign ownership of this iconic British institution.

UK finance minister Jeremy Hunt acknowledged the importance of international investment while emphasizing the need to assess national security considerations for key infrastructure. Dave Ward, general secretary of the Communication Workers Union, representing about 110,000 Royal Mail workers, expressed concerns about the potential takeover, urging EP Group to commit to the workforce and rule out any break-up of the company or reduction in pensions.

Jonathan Reynolds, the UK Labour Party’s business spokesperson, demanded assurances from EP Group to maintain Royal Mail’s headquarters in the UK and to collaborate closely with the labor union, asserting the institution’s quintessential British identity.

EP Group, in a recent statement, positioned itself as a long-term investor dedicated to supporting Royal Mail through its transformation into a modern postal operator, aiming to deliver high-quality service, workforce stability, and sustainable financial performance.

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