Greetings card industry sounds alarm over £3.5bn Royal Mail takeover

The greetings card industry has sounded the alarm over the proposed £3.5billion foreign takeover of Royal Mail.

Small business operators are calling for a ‘national, reliable, affordable’ service to be protected as fears mount over the future of the 508-year-old firm.

Royal Mail owner International Distributions Services last week said it was ‘minded’ to back a £3.5billion offer from Czech billionaire Daniel Kretinsky.

The businessman – known as the Czech Sphinx – has until Wednesday next week to table a formal offer that would pave the way for the company to fall into foreign hands for the first time since it was set up by Henry VIII in 1516.

But the Greeting Card Association, which represents more than 500 companies, is calling on ministers and regulators to protect the service. 

They are worried that Kretinsky will press ahead with plans to slash the frequency of second-class deliveries and hike the price of first-class stamps.

The group also wants to stop parcel deliveries being prioritised over letters and cards and prevent mass closures of post offices.

Cards are the most frequent form of post, with one in four Britons only using the postal service to send them.

GCA chief executive Amanda Fergusson said: ‘Our members, and the customers they serve, expect a postal service that’s national, reliable and affordable. 

They’re already nervous that planned regulatory reform will ignore these basic needs – and now they fear a deal with new owners that will do nothing to avoid further reductions in the quality of delivery services.

‘Whoever owns Royal Mail must be held accountable.’

Under its current owners, Royal Mail has urged regulators to let it cut its second-class service from six- day deliveries to every other weekday.

Its boss has said this would give it a ‘fighting chance’ to boost standards and help it save £300million.

But it could also result in almost 1,000 job losses.

Last month the cost of a first class standard letter increased 8 per cent to £1.35 while a second-class stamp now costs 85p – the same price of a first class stamp in early 2022. 

Royal Mail was privatised in 2013 but recent years have been tough as it has seen its share price plunge.

IDS – which also owns a profitable European parcels business – will publish annual results tomorrow that are expected to lay bare its dire performance, with Royal Mail losing nearly £1million a day.

Kretinsky has been warned he must pass national security tests and meet trade union demands to avoid his £3.5billion takeover plans being scuppered.

He already owns a 27.5 per cent stake in IDS as well as interests in football club West Ham and supermarket Sainsbury’s.