The £3.6bn takeover of International Distribution Services (IDS) - the owner of the 508-year-old Royal Mail - by Křetínský's EP Group was confirmed yesterday morning. It will be the first time Royal Mail has been controlled by an overseas owner in its history, which can be traced back to 1516 under Henry VIII.
The government will retain a "golden share" in IDS, which means any changes to Royal Mail's ownership, tax residency or headquarters will need its assent. The Royal Mail brand will also be protected for as long as EP owns the company.
The board of IDS agreed to the takeover in May after rejecting initial approaches at a lower price.
EP Group agreed to a series of undertakings to persuade the government to let the deal through. They include retaining the universal service obligation for a first-class postal service to anywhere in the country for a fixed price six days a week while Křetínský is in control - a stronger commitment than the previous five-year pledge.
Ministers have also blocked Royal Mail from making dividend or similar payments to its owners unless the company meets financial targets and has improved its postal delivery performance. Dividends and asset sales will also be blocked if they put the universal service at risk.
IDS has suggested second-class post could be reduced to every other weekday. Keith Williams, the non-executive chair of IDS, said the deal's approval was an "important milestone" but called for "urgent reform of the universal service and the continued transformation of this great British business".
Dame Melanie Dawes, the chief executive of the regulator Ofcom, told the BBC yesterday the company had "a lot of changes that they need to make" because of the decline in letter volumes and said the watchdog would make proposals for the future of the postal service next year.
This story is from the December 17, 2024 edition of The Guardian.
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This story is from the December 17, 2024 edition of The Guardian.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
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