Related Articles
The takeover of Royal Mail will trigger a fees bonanza for bankers and advisers – including ex Labour frontbencher Chuka Umunna.
Royal Mail’s owner International Distribution Services (IDS) is being bought by Daniel Kretinsky, known as the Czech Sphinx, for £3.6billion.
The deal will see the 500-year-old postal service fall into foreign ownership for the first time. Concerns over the takeover are mounting with unions, politicians and businesses calling for cast-iron guarantees that the service will be protected.
And it is thought that fees for bankers, lawyers and other advisers could reach £30million. Among those set to cash in will be Mr Umunna, a former Labour MP for Streatham and his party’s business spokesman.
Mr Umunna joined US investment bank JP Morgan after leaving politics and is part of the team hired by billionaire Mr Kretinsky to advise on the takeover.
Royal Mail’s owner International Distribution Services (IDS) is being bought by Daniel Kretinsky (pictured), known as the Czech Sphinx, for £3.6billion
It is thought that fees for bankers, lawyers and other advisers could reach £30million. Among those set to cash in will be Mr Umunna (pictured), a former Labour MP for Streatham and his party’s business spokesman
The deal will see the 500-year-old postal service fall into foreign ownership for the first time. Concerns over the takeover are mounting with unions, politicians and businesses calling for cast-iron guarantees that the service will be protected
Mr Kretinsky has also appointed BNP Paribas and Citi to work on the takeover, with media relations taken care of by FGS Global.
Barclays, Bank of America Securities and Goldman Sachs are also set to rake in huge fees after being hired by IDS to oversee the sale.
The average amount paid to advisers on deals worth £3billion or more since 2020 was 0.85 per cent, according to London Stock Exchange Group data.
That means those hired to work on the takeover could earn around £30 million.
Full details of the fees that will be paid will be revealed in an offer document to be published later this month.
It comes after Labour last week vowed to ‘robustly scrutinise’ the deal and give postal workers a ‘stronger voice’ in a pre-election pledge.
Crucially, Sir Keir Starmer’s party said in its manifesto it would explore giving workers more of a say in how Royal Mail is run. The promise appeared to cede ground to the unions demanding that posties are given part ownership of the company through a collective employee trust.
Sir Keir Starmer’s party said in its manifesto it would explore giving workers more of a say in how Royal Mail is run. The promise appeared to cede ground to the unions demanding that posties are given part ownership of the company through a collective employee trust
Such a move could put Mr Kretinsky off the deal altogether. He has made several promises, including keeping the Royal Mail name and brand and retaining its UK headquarters and tax residency to keep it tied to Britain.
But the Communication Workers Union has called on Mr Kretinsky to go further and give posties a stake.
Kretinsky, who co-owns West Ham United and has a major share in Sainsbury’s, has hinted he would back current management’s proposals to reform the service. These plans include cutting second-class post to three days a week, paving the way for redundancies. Shareholders will vote on the deal at IDS’s annual general meeting in September.
