LONDON, May 29, 2024 (BSS/AFP) - The owner of Britain's struggling Royal Mail
said Wednesday it had accepted a takeover proposal from Czech billionaire
Daniel Kretinsky worth o3.6 billion ($4.6 billion).

It comes after Kretinsky's conglomerate EP Group formalised an improved offer
for International Distribution Services (IDS).

"The IDS board believes that the offer from EP is fair and reasonable," IDS
chairman Keith Williams said in a statement posted on the London Stock
Exchange.

EP already has a stake of 27.6 percent in IDS, while the takeover is subject
to shareholder and regulatory approvals.

The deal for the former state monopoly Royal Mail must also be approved by
the government, which is on course to change hands in a general election due
July 4.

Polls widely forecast the main opposition Labour party to win power after 14
years of rule by the Conservatives, currently led by Prime Minister Rishi
Sunak.

His party privatised Royal Mail in 2013 after winning power three years
earlier.

The postal operator has since seen its core letters business ravaged as
consumers increasingly communicate online, which has conversely helped its
international parcels business, GLS.

Britain's communications regulator Ofcom has proposed that Royal Mail cut
delivery to five days, or even three days per week, potentially saving the
company hundreds of millions of pounds.

IDS has long called for a shakeup of the universal service obligation (USO),
which stipulates that Royal Mail must deliver letters six days a week to all
32 million addresses in the UK for the price of a stamp.

- European potential -

EP on Wednesday described IDS as "a strong business with solid foundations
and the potential to become one of the leading postal logistics groups in
Europe", subject to modernisation that includes USO reform.

At the same time, Kretinsky said his group "has the utmost respect for Royal
Mail's history and tradition", adding that owning a business with more than
500 years of history "will come with enormous responsibility -- not just to
the employees but to the citizens who rely on its services every day".

The accepted offer was priced at 370 pence per IDS share. Following
Wednesday's announcement, IDS stock was up 3.6 percent at 332.5 pence in
London morning deals.

"The group's international arm GLS has long been considered the jewel in the
company's crown, enjoying a level of success which Royal Mail has found
elusive and EP Group will have been eyeing up the long-term opportunities
here," noted Susannah Streeter, head of money and markets at Hargreaves
Lansdown.

EP said it would honour a commitment by IDS management not to impose
compulsory redundancies at Royal Mail until April next year.

Dave Ward, general secretary of the Communication Workers Union, said he
would meet with EP next week, when he will call for "further commitments on
the future of the company".

IDS employs about 153,000 staff, with the vast majority representing Royal
Mail.