Last night Royal Mail came under fresh scrutiny after its owner delayed publishing its latest accounts as it heads towards a £3.5bn takeover by a Czech billionaire.
In an announcement that took the city by surprise, International Distributions Services (IDS) said KPMG accountants needed more time to assess its financial results.
It came as Daniel Kretinsky, the West Ham United co-owner nicknamed the ‘Czech Sphinx’, mulls making a formal bid before the deadline next week.
“What a disaster,” was one investor’s verdict. IDS, which also owns European parcel company GLS, had told the market it would publish its results for the year ending March 31 at 7am yesterday.
The figures were expected to show the Royal Mail division lost more than £300m.
Deadline: Czech billionaire Daniel Kretinsky (pictured) has until next week to make a formal bid for IDS
But shortly before 2:00 p.m., IDS reported that the financial statements had been delayed indefinitely.
“The group’s auditor, KPMG, has requested more time to complete usual standard procedures after its internal reviews fell behind the audit schedule, thereby delaying its final audit process,” IDS said.
Last week, the board, led by chairman Keith Williams, said it was “willing to accept” Kretinsky’s 370 pence per share offer after rejecting an earlier offer.
That shocked the City and Westminster, as a deal would see the postal service, established by Henry VIII in 1516, come under foreign ownership for the first time.
Business Secretary Kemi Badenoch sought commitments from Williams and IDS chief executive Martin Seidenberg that Royal Mail’s universal service obligation (USO) would be protected.
Under the terms of the offer, Kretinsky has committed to delivering first-class letters six days a week, protecting workers’ rights and the Royal Mail brand, as well as its UK headquarters and tax residence.
But there are fears for the future of second-class mail and the cost of first-class stamps.
The service, privatized in 2013, has been pushing for OSU reform.
Royal Mail lost £319m in the first half of the last financial year after falling £1bn into the red the year before.
Kretinsky, IDS’s largest shareholder, has until 5:00 p.m. on Wednesday, May 29, to make a formal offer or withdraw.