Royal Mail: The curious case of why a billionaire wants to buy what looks like a fading relic

Royal Mail, a historic institution in the UK, is set to be taken over by a Czech billionaire named Daniel Kretinsky. This news has raised many eyebrows, as Royal Mail has been struggling in recent years. Founded over 500 years ago, Royal Mail has been a significant part of British life, delivering letters and parcels to homes across the country. However, the company has faced numerous challenges, including a decline in the number of letters sent, which has dropped from 20 billion in 2004 to under 7 billion last year. Additionally, Royal Mail has been fined for not meeting delivery targets and has experienced strikes from its workforce, leading to a loss of trust and morale among employees. Daniel Kretinsky, who is worth around £6 billion, is known for his investments in various sectors, including energy and retail. His decision to buy Royal Mail has sparked curiosity about his motivations. Many wonder why a successful businessman would want to invest in a company that appears to be in decline. Kretinsky's plan involves revitalizing Royal Mail and making it more competitive in the delivery market. He aims to invest in technology and infrastructure to improve the company's operations. One of his key strategies is to change the rules regarding the delivery of letters, which could save Royal Mail a significant amount of money. By reducing the frequency of second-class letter deliveries, Kretinsky believes he can help the company break even financially. He has also promised to honor the Universal Service Obligation, which requires Royal Mail to deliver letters six days a week and parcels five days a week. This commitment is crucial for maintaining the trust of both customers and employees. Kretinsky's vision for Royal Mail includes expanding its parcel delivery services, which have become increasingly important in the age of e-commerce. He plans to introduce parcel lockers in supermarkets, allowing customers to pick up their packages at their convenience. This move could enhance customer satisfaction and improve efficiency in the delivery process. Furthermore, Kretinsky has assured employees that there will be no compulsory redundancies for two years and that he will protect the company's pension surplus. This commitment has been welcomed by union representatives, who were initially skeptical about the takeover. Overall, Kretinsky's acquisition of Royal Mail represents a significant shift for the company. While there are challenges ahead, his investment and plans for improvement could potentially lead to a brighter future for this iconic British institution.