Labour to call for £3.6bn takeover of Royal Mail

Labour will “demand” a £3.6bn takeover of Royal Mail by a billionaire nicknamed the Czech Sphinx, the Business Secretary said yesterday.

Jonathan Reynolds said he had no objection in principle to the postal service having a foreign owner, but added that the deal would be reviewed closely. He said he planned to hold talks with the potential buyer, Daniel Kretinsky, this week.

The Czech tycoon has agreed to buy parent company International Distribution Services (IDS) in a deal that will see Royal Mail fall into foreign hands for the first time since it was founded by Henry VIII in 1516.

Kretinsky has offered a series of promises about jobs and the Universal Service Obligation (USO) – delivering mail across the UK six days a week at a single price – to win the junta’s support.

However, many remain concerned about the implications for Royal Mail’s future, especially as the pledges are limited to five years at most.

The deal also remains subject to national security scrutiny by the government, a process that Kretinsky, the company’s largest shareholder, already went through when he increased his stake.

Asked what the new Labour government planned to do about the deal,

Reynolds said: “It would be reasonable to expect that it would be called. I myself will be speaking to Kretinsky later in the week. I know the union has some talks scheduled.

‘Obviously, central to this is what the business plan is, what that means for the UK’s core national interest in Royal Mail, particularly given how the USO operates, and how we can have confidence in the assurances put forward in that business plan that we can rely on.

‘These are all reasonable topics of conversation that we will have.’

Asked if he was against the idea of ​​Royal Mail being foreign-owned, he said: “No.” Mr Kretinsky is due to meet the head of the postal workers’ union for the first time today. He will hold talks with Dave Ward, general secretary of the Communications Workers’ Union, which has called for employees to be given a stake in the company.

Kretinsky is believed to have rejected these overtures, setting the stage for a frosty meeting at Royal Mail’s sorting facility in Mount Pleasant, London.

Labour was elected on a manifesto promising to “ensure that any takeover proposals are rigorously scrutinised”.

The manifesto added: “Labour will also explore new business and governance models for Royal Mail, so that workers and customers who rely on Royal Mail’s services can have a stronger voice in the governance and strategic direction of the business.”