A billionaire nicknamed the ‘Czech Sphinx’ has launched a daring raid on Royal Mail that could see the 508-year-old postal service fall into foreign hands.
Daniel Kretinsky, co-owner of West Ham United and with a stake in Sainsbury’s, has already seen an initial bid valued at £3.2bn rejected.
But the tycoon, 48, is now working on a new bid for International Distributions Services (IDS), which owns Royal Mail.
A deal would see Royal Mail come under foreign ownership for the first time since it was established by Henry VIII in 1516, a prospect that is likely to provoke furious opposition from the unions, Westminster and the public.
Analysts said any acquisition could be blocked by the government.
Storming the job: Daniel Kretinsky, co-owner of West Ham United and with a stake in Sainsbury’s, has already seen an initial bid worth £3.2bn rejected.
The raid comes as Royal Mail, one of Britain’s oldest companies, is in crisis as it struggles to keep up with courier services such as Amazon.
The company wants to reform the universal service obligation, which means it must deliver letters six days a week throughout the country for the fixed price of a stamp.
It also hopes to reduce second-class deliveries to every other day.
Royal Mail said it delivers 7 billion letters a year, up from 20 billion a decade ago.
That level is expected to fall to around 4 billion in the next five years. Meanwhile, it has faced a backlash for increasing the cost of a first-class stamp to £1.35, the fourth increase in just two years.
It comes amid complaints about delivery delays last year and a massive strike in 2022.
Share rose 29 per cent, or 61.8p, to 276p yesterday after Kretinsky’s announcement, but were still languishing below the 330p mark they floated at in 2013.
Kretinsky, who owns a 27.56 percent stake in IDS, said yesterday that his EP group made an offer for the rest of the company’s shares on April 9.
IDS said the 320 pence per share offer “significantly undervalues IDS and its future prospects”.
In a statement, the company said: “The board of directors believes the timing of the proposal is opportunistic.” It does not reflect the growth potential or prospects of the company.’
Kretinsky is working on an improved offer, Reuters reported, and has until Wednesday, May 15, to make a firm offer under UK takeover rules.
Dan Coatsworth, investment analyst at AJ Bell, said: “The proposal has been rejected but once again highlights the UK market as a veritable feast of bargain bargains.”
Ministers allowed Kretinsky to increase his stake in Royal Mail when it passed the 25% threshold in 2022.
But one prominent analyst, who asked not to be identified, said clearance under the National Security and Investment Act would be required for a full takeover.
“Ironically, a precedent was set in 2022 when Kretinsky requested prior approval to increase his stake above 25 percent,” they said.
‘The Government chose not to block that. But a full takeover would be a different matter.’
A spokesperson for the Communication Workers Union said: ‘The truth is that handing ownership of one of the UK’s most prestigious institutions to a foreign investor cannot be right.
“But neither is the current model or the direction of the company.”
AJ Bell’s Coatsworth said: “The Government might also want to know what is going on, given the crucial role Royal Mail plays in distributing information to consumers and businesses.”
The Department of Business and Commerce declined to comment yesterday.