Britain’s Royal Mail is being bought by Czech billionaire Daniel Kretynsky for $4.6 billion.

London
CNN
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The owner of Royal Mail has accepted a £3.57 billion ($4.6 billion) takeover bid. Czech billionaire Daniel KretynskyIt paved the way for one of Britain’s oldest and best-known companies to be sold to a foreign owner for the first time.

Loss-making Postal Service-owned International Delivery Services said Wednesday It accepted £3.70 ($4.69) per share A takeover offer from Křetínský’s EP Group.

The deal has ramifications for thousands of workers and raised concerns about the future of a key piece of national infrastructure that provides a vital public service.

The EP Group has made a number of commitments to address these concerns, including upholding Royal Mail’s “universal service obligation”, which requires letters to be delivered at the same rate six days a week in the UK.

It has pledged to maintain employee benefits and pensions and to keep Royal Mail’s headquarters and tax base in the UK.

“EP Group has great respect for the history and heritage of Royal Mail, and I know that owning this business comes with enormous responsibility – not only for employees, but also for the citizens who rely on its services every day,” said Křetínský. Report.

He said IDS has the potential to become “one of the largest postal logistics groups in Europe” but its “market is rapidly evolving” and it needs to modernize to keep up with competitive delivery services. Křetínský’s Vesa Equity Investment, a private equity firm, is already the largest shareholder in IDS with a 27.6% stake.

The contract continued for a few years for Royal Mail, which was privatized in 2013. It has suffered a sharp fall in demand for its services and posted a loss of £348 million ($445 million) for the year ended March 31. A slightly better result than the £419 million ($536 million) loss from the previous year.

“The IDS board believes EP’s offer is fair and reasonable, and allows investors to realize value at a significant premium given the uncertainties,” IDS chairman Keith Williams said in the statement.

However, not everyone is convinced.

Dave Ward, general secretary of the Communications Workers’ Union, which represents around 110,000 Royal Mail workers, said the takeover was “the direct result of a failed and ideological privatization a decade ago, mixed with the company’s gross mismanagement in recent years”.

The workers want more responsibility from EP Group on the company’s future, he said.

“We welcome some of the assurances that have been made, but the reality is that postal workers across the UK have lost all confidence in Royal Mail’s senior management and the service has been deliberately reduced,” he added in a statement.

Křetínský’s move comes at a politically critical moment as the United Kingdom prepares for a general election on July 4. The proposed acquisition is subject to a national security review, possibly by a new government. Opinion polls suggest Labor will win its first election since 2005 and replace the current Conservative administration.

Labor has already expressed keen interest in the deal.

“Royal Mail is synonymous with Britishness and Labor will take the necessary steps to protect its undeniable identity and place in public life,” wrote Jonathan Reynolds, the party’s business spokesman. Letter to Krétínský earlier this month.

A low-profile Czech national, Křetínský made his fortune through a vast empire of European energy companies, retailers and football clubs. He is worth an estimated $7.7 billion, according to the Bloomberg Billionaires Index, and owns a 27% stake in West Ham United Football Club.