The Czech billionaire Daniel Křetínský’s takeover bid for Royal Mail has been called in by the UK government for closer scrutiny under the National Security and Investment (NSI) Act, the Guardian understands.
Royal Mail’s owner, International Distribution Services (IDS), agreed to a £3.57bn takeover by its largest shareholder, Křetínský’s EP Group, in May.
The bid will be scrutinised by the Cabinet Office, with help from the Department for Business and Trade, as to whether it could negatively affect a key part of the UK’s economic infrastructure.
Under the deal, Křetínský, who made his fortune in energy and owns a minority stake in one of the main gas pipelines from Russia into Europe, would pay 360p a share for the 73% of the struggling postal service he does not already own.
The British government has now decided to examine the sale of the formerly state-owned service to a foreign buyer under the NSI Act, in news first reported by the BBC. The act gives ministers the power to block the sale of companies considered part of critical national infrastructure.
Government officials told the BBC that any links to Russia would be carefully examined.
Jonathan Reynolds, the business secretary, said last week that it was “reasonable” to expect the government to call in the bid for review, before a meeting with Křetínský. He added that he would look at how the government could receive binding assurances from Křetínský.
In May, IDS bosses held a meeting with the then business secretary, Kemi Badenoch, to discuss the bid and reforms to the universal service obligation (USO), which guarantees delivery to every home in the UK six days a week.
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’s headquarters in the UK for five years. Křetínský, who also owns a stake in West Ham United Football Club, supports a Royal Mail plan to cut deliveries of second-class post to every other weekday.
The union representing postal workers has called for staff to be handed a serious stake in Royal Mail, after Křetínský floated the possibility of implementing an “incentive scheme” if he was successful.
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The scrutiny of the sale could take up to two months.
The government already stepped in with a review when Křetínský increased his stake in Royal Mail’s parent company from 25% to 27.5% in August 2022, and cleared it within two months.
The Cabinet Office, EP Group and IDS all declined to comment.
