Royal Mail £3.6bn takeover delayed amid political woes in Romania
EP Group still needs to gain approval from officials in Romania and now expects to complete the takeover in the second quarter.
Royal Mail’s £3.6 billion takeover by Czech billionaire Daniel Kretinsky is set to be delayed until the second quarter amid a political crisis in Romania.
Mr Kretinsky’s EP Group said the only regulatory bar still to be cleared relates to its foreign direct investment in Romania.
It confirmed that, while there are no major issues expected with the Romania investment and that talks to gain approval from authorities are “progressing well”, it now predicts clearance will only come in time to see the deal complete in the second quarter.
EP Group had previously hoped to complete the takeover in the first three months of 2025.
Mr Kretinsky – nicknamed the “Czech sphinx” – needs to clear the regulatory hurdle in Romania because part of his business operates in the country.
Romania is in the middle of political upheaval after a presidential election was cancelled last year following allegations of Russian interference.
Mr Kretinsky’s deal to buy Royal Mail owner International Distribution Services was cleared by the UK Government in December last year.
It paved the way for the more than 500-year-old postal service to pass into foreign ownership for the first time.
Mr Kretinsky made a number of pledges to soothe concerns over his takeover, including a vow to keep the brand name and retain Royal Mail’s HQ and tax residency in the UK for the next five years, as well as commitments to protect the company’s universal service obligations.
Since the deal was agreed, regulator Ofcom has said it is set to allow Royal Mail to ditch Saturday deliveries for second class letters and cut wider postal delivery targets in view of declining demand for letter mailings.
Ofcom said in January it had provisionally concluded that reducing the second class letter service to alternate weekdays, while keeping first class deliveries six days a week, would continue to meet postal users’ needs.
This would save Royal Mail between £250 million and £425 million a year, according to the regulator.
