Kretinsky's Firm to Invest in Royal Mail, Aiming to Challenge Amazon's Dominance in E-Commerce Logistics
Sunday, Jul 14, 2024 6:44 am ET
Daniel Kretinsky's firm, led by J&T Capital Partners, is planning to cut parcel prices and invest GBP800 million to enhance Royal Mail's competitiveness. This strategic move aims to compete with Amazon's 5,000 parcel lockers in the UK. After purchasing Royal Mail's parent company for GBP3.57 billion, Kretinsky intends to install 20,000 Amazon-style lockers in a three to five-year plan.
In a bid to enhance Royal Mail's competitiveness and take on e-commerce giant Amazon in the UK, Daniel Kretinsky's firm, J&T Capital Partners, is planning to slash parcel prices and invest £800 million to install 20,000 Amazon-style parcel lockers [1]. The objective of this strategic move is to win back market share and provide customers with more convenient and cost-effective delivery options.Royal Mail, which has been focusing more on parcel deliveries due to the decline of its letter business, has lost significant market share to competitors such as DPD, Evri, and InPost [1]. Furthermore, the company faces tough competition from Amazon's extensive proprietary delivery network, which operates around 5,000 parcel lockers across the UK [1].
Kretinsky, who has already tabled a £3.6 billion offer for Royal Mail's parent company, International Distribution Services (IDS), is keen to build a new pan-European retail and logistics empire to rival Amazon [1]. Alongside Royal Mail, IDS also owns European parcels business GLS, and Kretinsky holds a large stake in Dutch operator PostNL [1].
The decision to cut parcel prices and invest in parcel lockers comes as part of a broader plan to cash in on the booming demand in the e-commerce era. The investment is expected to be spent over the next three to five years, and the installation of parcel lockers is expected to allow customers to collect and drop off packages more conveniently [1].
Despite concerns raised about the impact of a foreign-owned postal service on national security, the UK government launched a national security investigation into the deal in recent weeks, and sources close to EP Group expect the takeover to be subjected to closer scrutiny [1].
References:
[1] "Czech businessman Daniel Kretinsky plans to slash Royal Mail's parcel prices in an effort to win back market share from rivals," The Telegraph, July 13, 2024. https://www.telegraph.co.uk/business/2024/07/13/czech-sphinx-spend-800m-royal-mails-bid-take-on-amazon/