Royal Mail owner International Distribution Services (IDS) is to be acquired after agreeing a £3.57bn deal with Czech billionaire Daniel Kretinsky.
Kretinsky's EP Group vehicle, which already owns 27.6 per cent of the business, made a formal bid for the business following initial proposals earlier this month. The deal will see EP pay 370 pence per share to investors in IDS.
Shareholders will vote on the deal at IDS's next annual general meeting in September.
IDS said the offer would see Royal Mail continue its universal single-price first-class mail service obligation anywhere six days a week, and would maintain the company's brand and headquarters in the UK.
It also said it would protect the existing employment rights of all IDS staff and that “there is no intention to make any material changes to overall staffing or reductions in the number of frontline workers” beyond existing plans.
The board said the offer reflects “the progress being made on changes at Royal Mail, as well as the execution risks associated with delivering long-term value for shareholders in light of the uncertainty over the nature and the timing of universal service reform and the need for rapid reform and significant strategic investments.”
The decision to buy IDS is just the latest investment by former lawyer Kretinsky, who also has stakes in West Ham United and Sainsbury's.
Keith Williams, Chairman of IDS, said: “IDS has the potential to become a leading player in international logistics.
“Both the IDS board and the EP are keenly aware of their responsibilities to IDS and, in particular, to the unique heritage of Royal Mail and its obligations as a designated universal service provider of postal services in the UK.
“The IDS Board of Directors has negotiated a wide-ranging package of legally binding commitments and commitments that provide our customers, employees and broader stakeholders with important safeguards.
“These cover the provision of the single price universal service obligation (including first class letters still delivered six days a week), the financial stability and maintenance of the IDS Group, including Royal Mail, the maintenance of the employee benefits and pensions. and ensure that Royal Mail remains headquartered and tax resident in the UK.”
Communication Workers Union general secretary Dave Ward said: “We welcome some of the commitments that have been made, but the reality is that postal workers across the UK have lost all faith in high Royal Mail address and the service has been deliberately discontinued.
“We will meet with the EP Group next week and call for a full reset of industrial and labor relations, the restoration of postal services and further commitments on the future of the company.
“We will also work directly with the Labor Party and other stakeholders to demand a new ownership model for Royal Mail in which our members and customers have a direct say in key decisions and the creation of a golden share that will protect a key stake.” . of the UK's communications infrastructure.
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