British Postal Workers' Union warns Daniel Ketensk to strike

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Britain's post office union has issued a strike warning if Czech billionaire Daniel Ketnsk fails to meet demands in his bid to take over Royal Mail, raising the threat of strikes that have plagued the company in the past.

Communications Workers' Union general secretary Dave Ward said the group was determined to take all necessary steps to protect Royal Mail's universal service obligation to deliver letters and parcels across the country at the same price as its terms of employment.

There are certain things that if attacked we will take strike action. He told the Financial Times he would call a vote of our members, adding that the union would also challenge the separation of the group from its struggling letters business and its more profitable parcel operations.

Ward's comments come after Ketnsk EP Group, the largest investor in Royal Mail owner International Distribution Services (IDS), proposed $5 billion, including debt, for the group.

This comes despite long-standing tensions between management and postal staff that have worsened Royal Mails' efforts to generate revenue and maintain service levels in recent years.

IDS said on Wednesday it was willing to recommend EP Group's offer to acquire Royal Mail and its separate Netherlands-based courier company, GLS, after rejecting its initial bid last April.

Analysts have suggested that the IDS takeover could lead to a breakup of the business, separating Royal Mail from its more profitable parcel group GLS, which faces declining letter deliveries and tougher regulatory targets.

Ketnsk has made clear in its negotiations its intention to avoid forced redundancies without splitting Royal Mail from GLS or touching on group pension scheme surpluses.

But IDS's shares were trading at 322.8p on Friday, well below the 370p per share offered by EP Group earlier this week, signaling some investor skepticism about the prospects for the deal, especially as the general election approaches.

Market prices suggest investors are skeptical the offer will succeed, a top IDS shareholder said.

Prime Minister Jeremy Hunt said on Friday the bid for Royal Mail would be subject to normal scrutiny on national security grounds.

He said he welcomed international investment in British companies in principle, according to Reuters.

However, we always review national security considerations to ensure that there is no future risk in terms of our critical infrastructure and that any bid for Royal Mail goes through normal processes.

Wards' warning about strikes comes as it fears a repeat of the 18-day strike in 2022 over management's plans to align employment conditions with rivals, giving rivals such as Amazon and DPD a chance to gain market share from the former state-owned mail service. It threatens to provide an opportunity.

Royal Mail and the CWU agreed on pay and employment conditions last year, but Ketnsk's proposals have reignited union fears about the direction of the company as it faces competition from rivals recruiting couriers on lower wages and more flexible contracts .

IDS said on Wednesday that EP Group had agreed to propose a series of contracts to protect key elements of public interest and recognize Royal Mails' status as a key part of the country's infrastructure.

This included protecting employee rights, continuing union recognition, protecting the Royal Mails name and brand, and maintaining the company's base in the UK. IDS said that under the proposals, Royal Mail's uniform service and delivery of first-class letters six days a week would also be maintained.

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After meeting IDS CEO Martin Seidenberg and Chairman Keith Williams, UK Business and Trade Secretary Kemi Badenoch welcomed the deal agreed with EP Group. However, she said the details of this would be considered and agreed by the government.

A top IDS investor added: The new bid is an improvement over the previous bid. When a company requires a commitment from a bidder, there are obviously some trade-offs. You can then expect that cost to be reflected in the price you pay.

Ward cautioned that a balance must be struck. [Ketnsks reported assurances] This is the reality of this person's business.

We need more than assurances… We will need very detailed discussions with Ketnsk and his people about what their plans are for the future.

Ketnsk representatives declined to comment.

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