Royal Mail union not won by Czech bidder’s commitments | Business News

Commitments offered by the Czech tycoon seeking to buy Royal Mail’s parent company do not go far enough, according to the union leader representing the UK’s 112,000 frontline workers.

Communication Workers Union (CWU) general secretary Dave Ward made his comments following conversations with representatives from Daniel Kretinsky’s PE Group.

International Distribution Services (IDS) revealed last week that it has formally accepted a revised offer of £3.6 billion for the business, which includes the international parcel arm GLS.

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In full terms, the total value to shareholders represents a premium of more than 70% over the IDS share price before the first acquisition proposals emerged.

IDS said that if the deal, which is subject to shareholder approval and official scrutiny, were completed, the new owner would retain its existing UK tax residence, registered office, brand and employment rights.

PE Group ownership would also include a commitment to the current Royal Mail universal first-class mail service obligation at a single price, to anywhere, six days a week, the company said.

It added that the new owner had “no intention of making any material changes to the total number of employees or reductions in the number of frontline workers” beyond existing plans.

The union’s argument

Tuesday’s negotiations were held against a backdrop of relative peace between the union and IDS, after several bitter disputes.

The last one, which lasted more than a year, resulted in a series of strikes before Christmas 2022.

It only ended when the workers accepted a new salary agreement in exchange for reforms, including regular work on Sundays.

Relations remained frosty for a number of reasons, including the treatment of staff.

The CWU also opposed Royal Mail’s plans to dilute its universal service obligation for cost reasons.

Ward called for the debate over Royal Mail ownership to be a central issue in the July 4 general election, following Tuesday’s talks.

“The meeting was useful and constructive and other meetings will be held including the direct involvement of Daniel Kretinsky,” he said.

“We have made it very clear that the PE Group’s current commitments are neither strong nor long enough.

“Daniel Kretinsky has openly stated that he wants to own Royal Mail for the rest of his life – we need workforce commitments that match that level of ambition.

“The CWU has set out our broad concerns and our view that we need to see a completely new ownership and business model for Royal Mail – one that gives all employees a real stake in the future of the business. Both parties have agreed to explore this further.

“Royal Mail led a prolonged and deliberate attack on its own workforce, which continues to this day in many workplaces. EP Group representatives understood the reality that unless the workforce is on board, the company will never be successful.

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“Alongside this meeting, we are ramping up our plans to involve the government and the Labor Party in the takeover bid. This bid needs to be heavily scrutinized and debated, especially in the run-up to the general election.

“The CWU’s position is clear. We do not support a foreign company taking control of Royal Mail. At the same time, we have absolutely no confidence in the company’s current board.

“Royal Mail should be renationalised, but the political climate makes this very difficult at the moment.

“Our job now is to ensure our members are heard at every opportunity as this takeover bid unfolds,” he concluded.

For his part, Kretinsky, who is already a 27% shareholder in IDS, promised that the company would be safe in his hands.

He said last week that EP has “decades of experience in owning critical national infrastructure” and that IDS could “become one of the largest postal logistics groups in Europe”.

“The PE Group has the utmost respect for the history and tradition of Royal Mail, and I know that owning this business will come with a huge responsibility – not just for the employees, but for the citizens who depend on its services every day,” he added.