Royal Mail's potential buyer has said he plans to shake up the structure of the postal service, which could lead to thousands of jobs being cut and the removal of red pillar boxes.
Daniel Kretinsky, the Czech billionaire who has bid for Royal Mail's parent company International Distribution Services, said he sees the postal group’s future in the out-of-home delivery market.
“It is important for logistics companies not to miss this out-of-home delivery wave, which means they need to be ready to invest now," he told Reuters.
Under his vision, Kretinsky said he would consider injecting up to £400 million into the company to help set up a network of dropboxes and delivery lockers, removing the need for post and packages to be sent directly to people's homes.
“We believe that if the group [IDS and Royal Mail] doesn’t respond properly on the out-of-the-home solutions it may have a detrimental impact on its market share. And specifically in the UK, any shrinkage of the market share would be fatal," the 'Cezch Sphinx' added.
“It is a moment when the European postal market is once again evolving. It will be probably the next two to three years to come, which will decide what company will play what role in the out-of-home delivery solutions.”
Earlier this week, Royal Mail's owner recommended that shareholders accept a takeover bid worth 370p per share from Křetínský.
In another twist, unions representing postal workers at Royal Mail said they want a new business model that gives them a stake in the business and pay tied to growing services and social benefits.
Dave Ward, the general secretary of the Communications Workers Union (CWU), said the bid offers an opportunity for a new structure based on US-style public benefit corporations.
“The remuneration board for management is key, and we would push very strongly that in a public benefit company, remuneration would need to be linked far more clearly to the mission.
"Rewards would be given on growing the company, growing revenue, growing jobs and services, and elements based on delivering quality,” Ward told the Guardian.
Křetínský’s offer is subject to several conditions including retaining the Royal Mail’s universal service obligation (USO) to deliver first-class mail six days a week, keeping Royal Mail’s branding and maintaining a UK headquarters, albeit only for five years.
--adds union plan detail --