Royal Mail will be taken over by a Czech billionaire after it accepted a £3.6bn takeover offer.
The board of parent company International Distributions Services (IDS) on Wednesday said it has recommended an offer of 370p per share from Daniel Křetínský.
The offer consists of 360p in cash, plus a final dividend of 2p per share and a special dividend of 8p per share.
It values IDS at £3.57bn, or almost £5.3bn once debt is included.
The bid, which is likely to attract scrutiny on national security grounds, includes a series of legally binding undertakings on public interest issues.
These include maintaining the one-price-goes anywhere service and Saturday delivery for first class letters.
Mr Křetínský, has also pledged not to force through job cuts, to protect the Royal Mail brand and to keep the company headquartered and a tax resident in the UK.
The undertakings will be valid for at least five years following the completion of the deal, which requires approval from shareholders at the company’s annual meeting in September.
It marks the first time Royal Mail will fall into foreign ownership in its 500-year history.
Mr Křetínský, who is known as the Czech sphinx, is already the largest shareholder in IDS through his company EP Group. He is also an investor in Sainsbury’s and West Ham Football Club.
In a statement, he said: “The EP Group has the utmost respect for Royal Mail’s history and tradition, and I know that owning this business will come with enormous responsibility – not just to the employees but to the citizens who rely on its services every day.
“The scale of the commitments we are offering to the company and the UK Government reflect how seriously we take this responsibility, to the benefit of IDS’ employees, union representatives and all other stakeholders.”
Keith Williams, chairman of IDS, said: “IDS has the potential to become a leading international logistics player.
“Both the IDS Board and EP are acutely aware of their responsibilities to IDS and particularly to the unique heritage of Royal Mail and its obligations as the designated Universal Service Provider of postal services in the UK.
“The IDS Board has negotiated a far-reaching package of legally binding undertakings and commitments which provide our customers, employees and broader stakeholders with important safeguards.”
Mr Křetínský’s swoop on Royal Mail has sparked political concerns given the key role the company plays in British life.
Chancellor Jeremy Hunt has said any potential takeover will be scrutinised under national security laws to ensure it does not pose a threat to critical infrastructure.
Mr Křetínský was previously subject to a national security investigation when increasing his stake in the company above 25pc in 2022, though this was ultimately approved.
Business Secretary Kemi Badenoch has called for a meeting with the billionaire in anticipation of the potential deal, while shadow business secretary Jonathan Reynolds has also sought assurances.
In a statement on Wednesday, Labour said: “These assurances are welcome that Royal Mail will retain its British identity and safeguard its workforce with no compulsory redundancies. Labour in government will ensure these are adhered to.”
The Government is currently in purdah after Prime Minister Rishi Sunak called an election on July 4. Any decision to approve the deal is likely to fall to the next administration.
The Department for Business and Trade was contacted for comment.
The move has also drawn criticism from the Communication Workers Union (CWU), which represents postal workers.