Royal Mail is facing a takeover bid from the Czech billionaire who co-owns West Ham United.
Daniel Kretinsky, known as the “Czech sphinx”, has had a cash bid for the company rejected but has signalled he will continue his pursuit of the troubled postal service.
Mr Kretinsky, who is worth $7.2bn (£5.8bn), made a cash offer for Royal Mail’s parent company, International Distribution Services (IDS), through his EP Group. Mr Kretinsky already owns a 27pc stake in IDS.
Shares in IDS surged 15pc on the news.
EP confirmed it made an offer to buy the whole group but was rejected by the Royal Mail board.
It comes at a difficult time for Royal Mail, which has faced battles with unions and is struggling with the shift from letters to parcels.
It has warned its future could be at risk unless the Government scraps its legal obligation to deliver letters six days a week.
EP said in a statement: “Weak financial performance, poor service delivery and a slow transformation, in the face of a market going through structural change, have put the business under unsustainable pressure.
“With the increasing competition from multinational companies in the UK postal market, private investment in Royal Mail becomes crucial.”
Royal Mail has a public service obligation to deliver letters and any bid for IDS would almost certainly involve the Government.
Royal Mail was founded in 1516 and is one of the oldest companies in the UK.
Mr Kretinsky’s company said it “recognises that Royal Mail is an important national asset” and said it would be “prepared to support this iconic business as it transforms and rebuilds into a modern postal operator”.
EP also owns Netherlands’ PostNL and a person familiar with the matter said Mr Kretinsky was possibly exploring a plan to carve out the parcels arm of IDS and merge it with Dutch operator PostNL.
IDS comprises the Royal Mail business focused on letters and parcels, and a European business courier business, GLS.
Mr Kretinsky is already a significant investor in the UK, with stakes in Sainsbury’s and a 27pc stake in West Ham. He also owns the Czech football team AC Sparta Prague.
EP said: “As a committed long-term investor in the UK, EP Group recognises the importance of the Royal Mail business to its various stakeholders, including employees, trade unions, customers and government, as the UK’s sole designated universal service provider.
“EP Group has submitted its non-binding indicative proposal to IDS with the interests of these important stakeholders in mind.”
Royal Mail was contacted for comment.
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