EP Group finalizes labor agreements amid IDS acquisition By Investing.com

LONDON – EP UK Bidco Limited, a company backed by EP Group, a.s. and J&T Capital Partners (WA:), a.s., has entered into definitive agreements with the Communication Workers Union (CWU) and the Communication Managers Association (CMA Unite) as part of its ongoing acquisition of International Distribution Services plc (IDS). These labor agreements follow the initial offer announcement on May 29, 2024, where Bidco proposed to acquire all issued and to be issued share capital of IDS, excluding shares owned by VESA Equity Investment S.à r.l.

The CWU Agreement aims to secure a stable and successful future for Royal Mail (LON:), aligning the interests of employees, customers, and shareholders. It is contingent upon the acquisition’s completion and EP becoming the controlling shareholder. The agreement includes commitments to maintain Royal Mail as an end-to-end service provider, prevent outsourcing of CWU-represented grades, and cap the level of owner-drivers in Parcelforce. Additionally, it outlines plans to review new entrant grades, reduce reliance on agency workers, and introduce a new performance incentive scheme for employees. EP also agreed to create an Employee Benefit Trust funded by 10% of dividends, intended for employee distribution.

The CMA Unite Agreement, similarly conditional on the acquisition, ensures no compulsory redundancies during the implementation of Universal Service Obligation reforms and promotes redeployment over redundancies. It also includes provisions for managerial employee participation in the Employee Benefit Trust and the continuation of existing managerial short-term incentive programs.

Both agreements reflect Bidco’s stated intentions to honor existing labor agreements and to work collaboratively with the unions post-acquisition. The establishment of an Advisory Committee is also part of the agreements, facilitating union influence over Royal Mail’s future direction.

The acquisition of IDS by Bidco is still subject to regulatory approval, with certain conditions outlined in the Offer Document published on June 26, 2024, yet to be met. It is anticipated that the offer will become unconditional in the first quarter of 2025, pending these approvals.

These labor agreements are vital steps in the acquisition process and demonstrate EP’s commitment to addressing the concerns of Royal Mail’s workforce. The information in this article is based on a press release statement.

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