CVC trumps TNT as Royal Mail bidder
CVC PARTNERS, the private equity group, has offered to pay around £2bn for a 30 per cent stake in Royal Mail, it emerged yesterday, as the controversial bid to part privatise the franchise nudges ahead.
The group’s offer beats a bid from rival logistics group TNT, but is less than the government has hoped to reach.
The plan to sell a minority stake in Royal Mail, which will have to pass through government later this month to be approved, has divided the cabinet.
Over 100 Labour MPs contest that the move would breach a manifesto pledge. As over 140 members of parliament have signed a motion opposing the deal, Gordon Brown will need Conservative support to pull the measure through.
Business Secretary Peter Mandelson has been pushing for the sale of up to 30 per cent of the group, keen to shake up Royal Mail’s management and bring in fresh investment.
CVC Partners, chaired by Michael Smith, has emerged as the front-runner because it is prepared to inject a substantial sum to modernise Royal Mail’s technology, something the government has said is essential to safeguard the group’s long-term future.
TNT, the Dutch postal group, is being advised by Goldman Sachs in the bid battle.