Government to probe Czech billionaire’s Royal Mail stake over national security

Royal Mail told the London Stock Exchange that Kwasi Kwarteng ‘reasonably suspects’ that Vesa Equity Investment might increase its stake.

(PA) (PA Archive)

The Business Secretary has warned Royal Mail that the Czech billionaire part-owner of West Ham could face a national security probe if he raises his stake in the delivery giant to more than 25%, the company has told investors.

Royal Mail told the London Stock Exchange that Kwasi Kwarteng “reasonably suspects” that Vesa Equity Investment might increase its stake in the company from 22% to more than a quarter.

If this happens, it would trigger an investigation through the recent National Security Investment Act, the minister told Royal Mail.

Mr Kwarteng has the power to investigate deals that “will result in an acquisition that may give rise to a risk to national security”.

The firm said: “Royal Mail will fully cooperate with this review and a further announcement will be made as and when appropriate.”

Last month, the Business Secretary used powers from the Act to block a foreign sale for the first time, halting Beijing Infinite Vision Technology (BIVT) from buying the vision sensing technology from the University of Manchester due to security concerns.

Vesa is controlled by Daniel Kretinsky, a Czech energy billionaire with stakes in Sainsbury’s, Foot Locker and Macy’s.

Mr Kertinsky completed a deal to buy 27% of football club West Ham last year.

It comes amid a challenging period for Royal Mail, with more than 100,000 postal workers set to walk out on Friday in a dispute over pay.

The Communication Workers Union (CWU) said its members are taking industrial action for a “dignified, proper pay rise” after they voted in favour by 97.6% in a ballot.

Shares jumped 2.2% higher on Thursday afternoon shortly the update.