Royal Mail takeover by Czech billionaire Daniel Kretinsky approved by government
16 December 2024, 05:49 | Updated: 16 December 2024, 17:53
The sale of Royal Mail’s parent company to a Czech billionaire has received government approval.
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The agreement is set to be announced this morning, as Daniel Kretinsky's EP Group takes over from current owner International Distribution Services
The Czech billionaire has reportedly made a slew of concessions to get the deal approved, including granting Royal Mail workers a 10 per cent share of any dividends he receives.
It comes just days after Royal Mail was fined over £10 million for late deliveries in 2024.
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The Government will keep a so-called "golden share" that will mean it needs to approve any key changes to Royal Mail's ownership, headquarters location and tax residency.
Other promises Mr Kretinsky has reportedly made include a promise not raid the pensions surplus, to maintain the universal service and to keep the brand name and Royal Mail's headquarters and tax residency in the UK for the next five years.
Union bosses met with the billionaire over the weekend to confirm the deal, which is yet to be announced by the government.
It comes just days after Royal Mail was fined £10.5 million for late deliveries this year, as less than 75% of post is delivered on time.
The £10.5 million fine covers the 2023/2024 financial year, as less than 75% of post was delivered on time.
The regulator Ofcom said the poor service is 'eroding public trust' in the institution.
It is the second fine in two years, after the watchdog also gave Royal Mail a £5.6 million penalty in November 2023.
Ofcom said the fine will be passed in full to the public purse.
The penalty was brought down from the original amount of £15 million, reflecting Royal Mail’s admissions of liability and agreement to settle the case.
Just under 75% of first class post was delivered on time during the period, well short of its 93% target.
And 92.7% of second class post was delivered on time, below its 98.5% target, Royal Mail said.
Ian Strawhorne, Ofcom director of enforcement, said: "With millions of letters arriving late, far too many people aren't getting what they pay for when they buy a stamp.
"Royal Mail's poor service is now eroding public trust in one of the UK's oldest institutions.
"This is the second time we've fined the company since the pandemic.
"Royal Mail has provided an improvement plan, and we're seeing some signs of progress, but it must go further and faster to deliver the service that people expect."
A Royal Mail spokesperson said high quality service is "extremely important to us" and that it is making changes to deliver it.
