The energy tycoon behind the £3.6bn takeover of Royal Mail’s parent company has pledged to turn the ailing postal service around or “go home”.
Daniel Kretinsky, dubbed the Czech Sphinx, has dominated City chatter over the past few weeks after Royal Mail’s owner, International Distribution Services, waved through a takeover bid last week. However, he now has to convince investors he is the man to turn the troubled company’s fortunes around.
Kretinsky’s bid values IDS at 370p per share and it now needs to be approved by 75 per cent of shareholders, with the billionaire already owning a 27.6 slice of the company.
It comes after torrid period for the postal service, which has lost more than £1m every day for the past two years amid a sharp drop in demand and questions over its management.
“Our absolute mantra is that we want to increase Royal Mail market share,” Kretinsky told the Sunday Times in an interview. “We want to do better service for the right price.
“If we don’t deliver this, if we don’t deliver a better service to the British population, our plan has failed. And we can go home.”
Both political parties have given the deal, which effectively ends 500 years of British ownership, their approval subject to certain guarantees. It will still be subject to a review under the National Security and Investment Act given the foreign ownership of Kretinsky’s company.
Speaking to the Times, Kretinsky acknowledged the “the intuitive concern” towards what he described as Royal Mail’s “foreign moment”.
“Any foreign moment is something that is irritating. I can understand this completely,” he said. “On the other hand, the reason why we dare to show our ambition here is that I’m 100 per cent convinced that we will help the company.”
A major challenged faced by Kretinsky is placating the Communication Workers Union (CWU), which represents around 100,000 postal workers. It wants Royal Mail to be made a “public benefit company” to take the focus away from profitmaking.
Some 18 days of strike action were launched in 2021 and 2022 over pay and conditions. On Wednesday, Royal Mail won a high court injunction to stop industrial action in December in the run up to Christmas and at the time of the national election.
The CWU still wants the company to grow its revenue, jobs and services and Kretinsky believes his approach is similar. “If you look at our plan, and what the unions are calling for, I think our visions are very close,” he said.