Meanwhile, the Commons Trade and Industry Select Committee called on the Government to clarify what the Post Office's borrowing powers were following the agreement last month to give it greater commercial freedom.
John Roberts, chief executive of the Post Office, would not disclose how much it had paid for German Parcel, the country's fourth largest postal operator with sales of pounds 250m a year and 7 per cent of the market, nor how much profit it made. He said the deal had been funded out of the Post Office's own reserves, commercial borrowings and money borrowed from the Government at commercial rates.
But the privately-owned parcel operator UPS said it planned to complain about the deal to the European Commission and accused the Post Office of funding the purchase out of its monopoly Royal Mail profits.
A spokesman, Anton van der Lander, said that if Parcelforce, the Post Office's own parcel business, was a stand-alone commercial business, it would not have been able to borrow pounds 300m to finance the deal.
The deal also gives the Post Office a 23 per cent shareholding in General Parcel, a much bigger international parcel operator with sales of pounds 2bn. The stake is owned by German Parcel.
Mr Roberts would not be drawn on whether the Post Office planned to increase its stake in General Parcel but he said it intended to hold discussions with the other shareholders, the next biggest of which is United Carriers.
The new Secretary of State for Trade and Industry, Stephen Byers, welcomed the deal.Reuse content