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International Distributions Services (IDS), the parent company of Royal Mail, has rebuffed a takeover bid from Czech billionaire Daniel Křetínský’s EP Group, signaling a desire to maintain autonomy amid challenging market conditions.
Křetínský, known for his diverse business interests spanning from energy to media assets and football clubs, approached IDS with an undisclosed offer earlier this month. Despite the proposal, IDS rejected the bid, with EP Group expressing its intention to engage constructively with the company’s board.
EP Group’s statement acknowledges Royal Mail’s challenging situation, citing weak financial performance and slow transformation amid structural changes in the postal market. While recognizing Royal Mail as a vital national asset, EP Group underscores the importance of private investment in facilitating the company’s modernization and sustainable growth.
Shares in IDS surged by 20% following reports of Křetínský’s approach, reflecting investor interest in the company’s future trajectory. Křetínský, working with advisers in recent months, had been evaluating a potential bid for IDS.
IDS, comprising Royal Mail and General Logistics Group (GLS), faces critical decisions regarding its corporate future. Ofcom, the industry regulator, has proposed options for scaling back Royal Mail’s universal service obligations to address mounting losses. However, the government has expressed opposition to reducing the six-day-a-week delivery service.
Royal Mail’s request to modify its delivery schedules and reduce costs underscores the company’s efforts to adapt to evolving market dynamics. Any takeover bid would undergo scrutiny under national security laws, with Labour MP Kate Osborne advocating for renationalization of Royal Mail.