Czech Sphinx plots £800m Royal Mail investment to topple Amazon in UK parcel war
Billionaire Daniel Kretinsky, known as the Czech Sphinx, is planning to shake up the UK’s parcel delivery market with a £800m investment in Royal Mail aimed at outmuscling Amazon.
Following his £3.6bn bid for Royal Mail’s parent company, International Distribution Services (IDS), Kretinsky’s EP Group plans to blitz the market with 20,000 Amazon-style parcel lockers and slash delivery prices to win back customers, according to The Telegraph.
It is a bid to dominate the sector and out-do competitors like DPD, Evri, InPost, and Amazon’s network of around 5,000 lockers in the UK. Royal Mail, struggling with a declining letters business, has pivoted to parcels but remains pricier than rivals. A 2kg parcel costs £3.19 to send via Royal Mail compared to DHL’s £2.79.
Kretinsky is also reportedly crafting a pan-European logistics empire to challenge US behemoth Amazon. As well as parcels business GLS, the better performing half of IDS, he also holds stakes in Dutch operator PostNL, Sainsbury’s, French supermarket chain Casino, and German wholesale giant Metro.
It comes as IDS is set to report its first quarter results on Thursday. In May, the company’s full year trading update was delayed by more than 24 hours due to late internal reviews by auditor KMPG.
Royal Mail’s losses narrowed to £348m in 2024, up from £419m the prior year but IDS missed consensus forecasts and, as a result of the offer period, it gave no guidance on outlook. Liberium analysts said: “We saw little to be encouraged about.”
Kretinsky’s Royal Mail takeover has prompted a national security investigation as critics are wary of a historic British institution falling into foreign hands for the first time.
To mitigate concerns, the businessman has pledged to maintain Saturday first-class deliveries, protect the Royal Mail brand, and keep the headquarters and tax base in the UK. He is also negotiating a profit-sharing scheme to sweeten the deal for union bosses.
The takeover needs government and shareholder approval, with Labour promising thorough scrutiny of the deal. IDS’s non-executive board members will exit post-deal, leaving chief executive Martin Seidenberg’s future in limbo.
The London-listed stock has risen 21 per cent year to date as a result of the potential new ownership.