Yahoo Finance Union calls for Royal Mail staff to get ‘serious stake’ in service after takeover
The union representing postal workers has called for them to be handed a serious stake in Royal Mail, after the Czech billionaire bidding to snap up its owner for £3.6bn floated the possibility of implementing an “incentive scheme” if he is successful.
Daniel Křetínský’s EP Group published an offer document on Wednesday laying out the details of its bid for Royal Mail’s parent company, International Distributions Services (IDS).
It also wrote to 100,000 shareholders, who include current and former staff and who collectively own more than 5% of the company’s shares, asking them to sell, in a move that would help pave the way for the takeover.
Last month, the sale of IDS edged closer after its board accepted the £3.57bn offer from EP UK Bidco, a newly formed venture between EP Group and its longstanding partner J&T Capital Partners.
In Wednesday’s offer document, EP UK Bidco said it was “exploring, following completion of the acquisition, potentially offering a form of employee participation model in the business”. It said a “profit sharing mechanism” for employees was under consideration but stopped short of committing to a specific scheme.
It added that “no decision has been made in respect of the terms of, or timing for implementation of, such incentive scheme”.
However, a spokesperson for the Communication Workers Union, which represents postal workers, said: “We’re looking for a serious stake in the company but also a serious voice in the running of the company.
“We’re not interested in profit payouts that are at the mercy of a board – we want workers’ influence at all levels. Not just the main board, but the remuneration committee, the recruitment committees – to make sure we don’t recruit people who don’t have the interest of postal workers at heart.”
EP has committed to a number of undertakings and contractual commitments as part of its offer, including maintaining the delivery of first-class post six days a week, and keeping the business headquartered in the UK for five years.
Křetínský, who made his fortune in energy and owns a minority stake in one of the main gas pipelines from Russia into Europe, also supports a Royal Mail plan to cut deliveries of second-class post to every other weekday.
In his proposed deal, the billionaire would pay 360p a share for the 73% of the struggling postal service he does not already own, with investors also getting 10p in dividends for each share.
Křetínský, nicknamed the “Czech Sphinx” for his reluctance to speak publicly, must now persuade three-quarters of shareholders to back the deal. While thousands of postal workers were handed shares in Royal Mail when it was privatised in 2013 for £3.3bn, the majority of remaining shares are owned by big investors, including asset managers such as BlackRock, UBS and Schroders.
IDS shares edged down to 314p on Wednesday, in a sign that the City was unconvinced that the bid would succeed.
In theory, the next government could “call in” the takeover for scrutiny and prevent it, if it were deemed to be against the UK’s national security interests. However, Labour has not opposed the takeover in principle, saying it welcomes the assurances given by Křetínský and would ensure he stuck to them if, as polls suggest, it wins next week’s election.
The EP offer could be worth up to £3m to Royal Mail’s current and former directors, while postal staff who held on to the shares they were given during the 2013 privatisation could get a near-£3,400 windfall.
The offer document also detailed EP’s relationship with J&T Partners, a Czech private investment firm ultimately controlled by a private equity group.
A Guardian investigation this month raised questions about a series of controversial global property deals connected to Křetínský’s longtime business partners, including J&T founder Patrik Tkáč. If the deal completes, EP will own just over 56% of IDS and J&T just under 44%.
In the offer document, the bidders said: “J&T has been a long-term business partner of EP and its founder and controlling shareholder, Daniel Křetínský.
“Consistent with the approach taken for other investments in which both EP and J&T have participated, J&T is in the position of a financial investor; it has no co-management role and has no joint control in relation to Bidco.”
Bankers and other advisers at City institutions including Barclays, Goldman Sachs and JP Morgan will share in a windfall of up to £146m if the takeover is completed.
