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The postal service’s owner International Distribution Services agreed to a £3.57billion takeover offer from Czech billionaire Daniel Kretinsky’s EP Group in May
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Royal Mail’s soon-to-be new boss has pledged to uphold the six-day-a-week letter delivery promise across the nation.
The postal service’s owner International Distribution Services (IDS) agreed to a £3.57billion takeover offer from Czech billionaire Daniel Kretinsky’s EP Group in May. The move will see it taken off the public markets and into the hands of Mr Kretinsky’s firm, which already has a 27% shareholding in the business.
Royal Mail shareholders will vote on the deal at their next meeting on September 27. In an interview with the BBC, Mr Kretinsky said he will honour Royal Mail’s Universal Service Obligation (USO) for as long as he is in charge.
Underpinned by the USO, Royal Mail is duly tasked with ferrying first-class letters all week bar Sunday, serving every UK address for the same fee. Mr Kretinsky told the broadcaster: “As long as I’m alive, I completely exclude this, and I’m sure that anybody that would be my successor would absolutely understand this.”
“I say this as an absolutely clear, unconditional commitment: Royal Mail is going to be the provider of Universal Service Obligation in the UK, I would say forever, as long as the service is going to be needed, and as long as we are going to be around.”
Nonetheless, IDS has proposed to reform the system, which could reduce daily delivery routes by up to 9,000 and lead to roughly 1,000 voluntary redundancies.Mr Kretinsky, the billionaire investor, has expressed to the BBC that he is not a fan of shared ownership but is “very open” to profit sharing.
Trade unions representing postal workers have previously advocated for employees to be given a stake in the company through a restructuring of its organisation. However, Mr Kretinsky dismissed the idea of an ownership stake as “the right model”.
He explained to the broadcaster: “The logic is: share of profit, yes, (but an) ownership structure creates a lot of complexity. For instance, what happens if the employee leaves? He has shares, he is leaving, he is not working for the company, he (still) needs remunerating.”
He further added that he would rather “remunerate the people who are working for the company, and creating value for the company”. Mr Kretinsky, who reportedly has a net worth of £6billion, holds investments in several other ventures, including stakes in London football club West Ham United and supermarket behemoth Sainsbury’s.
The potential sale of Royal Mail’s owner has drawn significant attention, with high-ranking politicians and unions expressing concerns about the future of the postal service. The Government holds the power to veto the deal entirely, with Labour pledging to “robustly scrutinise” the takeover and promise workers a “stronger voice” in its election manifesto.
