The Czech billionaire bidding to buy Royal Mail has sent letters to more than 100,000 shareholders, including current and former staff, setting out its formal £3.75bn offer for the business.
Daniel Křetínský’s EP Group is asking Royal Mail staff, who own more than 5% of the shares in the company, to sell in a move that would help pave the way for the takeover.
The letters were posted on Wednesday, as Křetínský published the offer document confirming the details for his bid to buy Royal Mail’s parent company, International Distribution Services.
Last month, the sale of IDS edged closer after the board accepted the £3.57bn offer from EP. As part of the bid, Křetínský’s company has committed to a number of undertakings and contractual commitments, including maintaining the delivery of first-class post six days a week, and keeping the business headquartered in the UK for five years.
In the proposed deal, the billionaire, 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, 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, with the majority of remaining shares owned by investors, including big asset managers such as BlackRock, UBS and Schroders.
Royal Mail shares closed at 315p on Tuesday night, 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 is deemed to be against the UK’s national security interests.
Labour, which polls suggests will win next week’s general election, has not opposed the takeover in principle, saying it welcomes the assurances given by Křetínský and would ensure he stuck to them.
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.
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Unions are yet to back the deal and have previously said the guarantees given by the EP Group were “not good or strong enough”.
The Communication Workers Union (CWU) has called for workers to have a stake in the business, with sources close to Křetínský telling the Times that he could be willing to offer this in return for the unions’ blessing of the deal.
Sky News reported on Tuesday that advisers working on the acquisition were in line for a huge windfall, with bankers and consultancies likely to gain more than £130m from the deal.
The fee pool will be disclosed in the offer document, with EP Group paying tens of millions of pounds to banks for helping to finance the deal.