Kemi Badenoch warns Royal Mail bosses against £3.5bn sale of ‘Czech Sphinx’

By Jessica Clark and Jason Groves Political Editor and Martin Beckford

10:08 PM May 16, 2024, updated 10:50 PM May 16, 2024



Kemi Badenoch warned the Royal Mail last night that it will not allow it to be sold to an overseas buyer unless there are guarantees over the protection of vital services.

Amid mounting fears over what the proposed £3.5 billion takeover by a Czech billionaire will mean, the economy secretary held crucial talks with the 508-year-old postal company.

She told bosses that any deal should above all protect the vulnerable, people living in remote areas and small businesses.

Ms Badenoch also called for ironclad guarantees that the current six-day-a-week deliveries will be maintained.

But last night campaigners called on the Government to halt the sale altogether, with one declaring: ‘It needs to be blocked for God’s sake – it’s the Royal Mail.’

Kemi Badenoch warned the Royal Mail last night that it will not allow it to be sold to an overseas buyer unless there are guarantees over the protection of vital services
Ministers are determined to extract guarantees from prospective buyer Daniel Kretinsky (photo) before the deal goes ahead
But last night campaigners called on the Government to halt the sale altogether, with one declaring: ‘It needs to be blocked, for God’s sake, it’s the Royal Mail.’ Pictured: Royal Mail staff at St. Rollox sorting office in Glasgow sorting mail

While it is clear that the government does not intend to take such drastic measures, ministers are determined to extract guarantees from prospective buyer Daniel Kretinsky before the deal goes ahead.

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Politicians and campaigners said the risk to services, jobs and national security must be addressed.

Royal Mail’s future was thrown into doubt this week when Kretinsky, nicknamed the Czech Sphinx, launched the takeover bid for its parent company, International Distributions Services (IDS).

The IDS board, led by chairman Keith Williams and CEO Martin Seidenberg, said it “intended” to support the bid if a strong bid was submitted.

It led to fears that vital services, such as the delivery of NHS appointment letters, could be at risk.

Mr Kretinsky, a major shareholder in West Ham United and Sainsbury’s, insisted he would maintain the one-price-goes-anywhere service in the UK and first-class deliveries six days a week. He also promised that Royal Mail will keep its headquarters in Britain.

Ms Badenoch (pictured) also called for rock-solid guarantees that current six-day-a-week deliveries will be maintained
Rishi Sunak pledged to protect the mail, but said it was ultimately up to Royal Mail’s owners to decide whether to sell the company. Pictured: A postman delivers letters in Bath, Somerset

But that has done little to allay concerns about the future of Royal Mail and its deliveries if it were to fall into foreign hands for the first time since Henry VIII’s creation in 1516.

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At a meeting with Mr. Seidenberg and Mr. Williams yesterday, on the agenda before Mr. Kretinsky made his offer, Ms. Badenoch set out her stall.

A Business and Trade Department source said she “highlighted the importance of the Royal Mail in British society and it is the government’s priority to maintain that position.” Ms Badenoch is expected to meet Mr Kretinsky to outline the government’s position.

Rishi Sunak pledged to protect the mail, but said it was ultimately up to Royal Mail’s owners to decide whether to sell the company. But campaigners urged the government to go further and block the deal.

Dennis Reed of Silver Voices, a campaign group for older people, said: ‘My concern is that a fundamentally important part of Britain’s infrastructure may be owned by a billionaire from another country. There must be major safety concerns.

‘Many older people, the NHS and businesses rely on Royal Mail’s universal coverage. The government must intervene and stop this. It needs to be blocked for heaven’s sake: it’s the Royal Mail.

Dennis Reed of Silver Voices, a campaign group for older people (pictured), said: ‘My concern is that a fundamentally important part of Britain’s infrastructure may be owned by a billionaire from another country.
Liberal Democrat Treasury spokesperson Sarah Olney (pictured) said the takeover “cannot become yet another example of a foreign investor using a vital British company as an ATM.”
Andy Carter (pictured), Tory MP and chairman of the all-party group on media, told the Mail: ‘Ensuring the company remains headquartered in Britain remains my priority’

“Billionaires don’t get to where they are if they aren’t ruthless. That is very unlikely [Mr Kretinsky] would be sympathetic to isolated rural communities who may be dependent on Royal Mail.

“It will be a sad day if it goes that way. There is an urgent need for the government to intervene and make it very clear that there will be no foreign takeover and that other alternatives must be found.”

IDS shares remained at 320p last night – well below the offer price of 370p – suggesting there are doubts in the City over whether the deal will go ahead.

Amanda Fergusson, chief executive of the Greeting Card Association, said she was seeking “guarantees from the government that the postal service is protected”.

Liberal Democrat Treasury spokesperson Sarah Olney said the takeover “cannot become yet another example of a foreign investor using a vital British company as an ATM at the expense of customers or the public.”

Andy Carter, Tory MP and chairman of the all-party media group, told the Mail: ‘My priority remains to ensure the company remains headquartered in Britain.’

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