Royal Mail owner agrees to sell postal service

Britain’s Royal Mail has agreed to a £3.57 billion ($6.08 billion CAD) takeover by Czech billionaire Daniel Kretinsky, announced on Wednesday, May 29. This privatization deal values International Distributions Services (IDS), the parent company of Royal Mail and the international parcels network GLS, at 370 pence per share.

According to a Reuters news report, shares rose by only 3.5 per cent to 332 pence in morning trading, significantly below the offer price, indicating potential uncertainty about the deal. The acquisition is expected to undergo rigorous government scrutiny, particularly as it coincides with an election year and a vote scheduled for July 4.

Royal Mail, known for its iconic red post boxes adorned with the Royal Crest, has faced significant challenges including labor strikes, increased competition, and a declining market share in recent years. These issues have heavily impacted its stock, which has plummeted over 45 per cent from a record intraday high of 607.7 pence in May 2018.

Employing more than 130,000 people across the UK, Royal Mail has been striving to shift its focus towards parcel delivery as traditional letter volumes continue to decline.

In a media report, IDS said the sale is due to close in the first quarter of 2025.

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