Source - Alliance News

International Distributions Services PLC said it is minded to recommend a ‘fair’ revised non-binding proposal for a potential takeover offer from EP Corporate Group AS.

The London-based Royal Mail owner in April had rejected an ‘opportunistic’ offer from the company, which was for around 320 pence per share.

‘The proposal follows significant negotiation including a number of earlier proposals from EP Group,’ IDS said.

Prague-based EP Corporate is an energy company majority owned by Czech billionaire Daniel Kretinsky.

The new revised offer posted on Wednesday represents a total value of 370 pence per IDS share, 16% higher than the old offer. It values IDS’s share capital at about £3.5 billion.

IDS shares jumped 18% to 321.40 pence each on Wednesday afternoon in London, giving it a market capitalisation of £3.08 billion.

IDS Chair Keith Williams said: ‘The board is minded to recommend this offer price, which it considers to be fair and reflects the value of GLS’ current growth plans and the progress being made on change at Royal Mail to adapt the business to a significant fall in the demand for letters and growth in parcels.’

He added: ‘It is however regrettable that despite four years of asking, the government has not seen fit to engage in reform of the universal service and thus improve our financial position and ensure that Royal Mail could provide an economically sustainable service to the British public.’

IDS said: ‘The board has sought, and EP Group has agreed to offer as part of the proposal, a set of contractual undertakings to protect key public interest factors and recognise Royal Mail’s status as a key part of national infrastructure.’

With the new proposal, IDS extended the deadline for EP to announce its intention to make an offer, or not to make an offer, to May 29.

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