The owners of Royal Mail have agreed to a £3.6bn takeover bid by Czech billionaire Daniel Kretinsky.

The company’s parent firm International Distribution Services (IDS) said its board of directors had approved the deal after a formal offer was made earlier this month.

It said the agreement included a series of “contractual commitments” to protect public service aspects of the Royal Mail – such as its universal service obligation to “one-price-goes-anywhere” first-class post six days a week.

Mr Kretinsky’s EP Group already owns 27.6% of the business.

Shareholders will vote on the deal at IDS’s next annual general meeting in September.

It is also expected that the takeover will come under heavy scrutiny from regulators before it can go ahead.

The billionaire, who has been nicknamed the “Czech Sphinx”, reportedly due to his enigmatic nature and reluctance to speak in public, also owns parts of West Ham Football Club and Sainsbury’s.

The offer would see EP Group buy IDS for 370p per share.

Read more: Many are mystified why a Czech billionaire wants to buy Royal Mail’s owner

IDS said Royal Mail would keep the company’s branding and UK headquarters under the deal.

The company also insisted that the employment rights of all staff would be protected and that there was “no intention to make any material changes to overall headcount or reductions in the number of front-line workers”.

Unions and senior politicians have previously raised concerns about the potential takeover of the postal service, which was privatised in 2013.

The Labour Party previously called for a commitment for the Royal Mail to remain domiciled in the UK and keep paying tax here as part of any deal.

Reacting to the announcement on Wednesday, shadow business secretary Jonathan Reynolds said: “These assurances are welcome that Royal Mail will retain its British identity and safeguard its workforce with no compulsory redundancies.

“Labour in government will ensure these are adhered to.”

Business Secretary Kemi Badenoch met IDS bosses earlier this month for talks on the takeover, and is said to have urged its representatives to ensure services were protected for the vulnerable, those in remote areas and small businesses.

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General secretary of the Communication Workers Union, Dave Ward, said: “We do welcome some of the commitments that have been made but the reality is postal workers across the UK have lost all faith in the senior management of Royal Mail and the service has been deliberately run down.

“We will meet with EP Group next week and call for a complete reset in employee and industrial relations, the restoration of postal services and further commitments on the future of the company.”

He added: “We will also be directly engaging with the Labour Party and other stakeholders to call for a new model of ownership for Royal Mail where our members and customers have a direct say in key decisions”.

Mr Kretinsky described the Royal Mail as “part of the fabric of UK society and has been for hundreds of years”.

He added: “The EP Group has the utmost respect for Royal Mail’s history and tradition, and I know that owning this business will come with enormous responsibility – not just to the employees but to the citizens who rely on its services every day.”

It comes after the Royal Mail put forward proposed shake-up plans to Ofcom as part of turnaround efforts, including cutting down on some deliveries.

The regulator also recently launched an investigation after the company said it delivered less than three-quarters of first-class post on time in the last year.

UK drivers are paying the most for diesel in all of Europe, according to car and breakdown services company the RAC.

The average cost for a litre of diesel is 155p, 5p more expensive than the second highest average amount of 150p a litre paid in Ireland and Belgium.

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Unleaded costs aren’t as comparatively high, only the 11th most expensive in Europe at an average of 149p.

There is “no good reason” for the high diesel price or for retailers in the UK not to cut pump prices at the pumps, the RAC said.

Why are prices so high?

The margin retailers are charging – the difference between wholesale costs and the amount it’s eventually sold for excluding VAT – is significantly above the long-term mean, according to RAC figures.

Lack of competition can be blamed for the sum, the company said.

“It’s important to note that in Northern Ireland, where there is greater competition for fuels in the absence of supermarket dominance, the average price of diesel is just 144.9p – 10p less than the UK average, and petrol is 6p cheaper at 142.4p.”

While the long-term average is 8p a litre, a margin of 18p is being borne by motorists at present, the figures show.

Lower fuel duty

The rise comes despite the government having cut the tax on motor fuels by 5p in March 2022 in an effort to help drivers with high oil costs after Russia’s invasion of Ukraine.

Other European countries which pay more fuel duty still overall pay less to fill up their vehicle tanks, the RAC data shows.

Italy has the same amount of fuel tax – the joint highest in Europe – but there diesel is still currently 7p cheaper than the UK at an average of 148p a litre.

Competition context

The RAC compiled the data using information from competition watchdog the Competition and Markets Authority (CMA).

The CMA had concluded its investigation into margins at supermarket petrol stations, saying increased supermarket profit margins led to drivers paying an extra 6p per litre for fuel in 2022.

In March of this year the regulator said the margins remained “concerning”.

As part of a push for price transparency, a pumpwatch proposal was floated, where forecourts would have to enter prices within 30 minutes of a change to enable drivers to easily access the cheapest petrol and diesel.

Rising costs and crime levels were given as reasons for higher pump prices, the executive director of the Petrol Retailers Association Gordon Balmer said.

“Retailers are grappling with unprecedented levels of theft, along with significant increases in business rates, energy costs, and the National Minimum Wage. These factors inevitably impact the final price at the pump.

“A substantial percentage of diesel transactions in the UK are made using fuel cards, which operate on vastly lower margins. This further compresses the margins available to retailers and contributes to the higher prices seen by consumers.

“Despite the challenges posed by increased operational costs our members remain dedicated to providing fair and competitive prices. The PRA encourages motorists to use resources such as petrolprices.com to find the best deals available.”

Rishi Sunak’s committee of business advisers refused to publicly back the government’s economic policy record on Tuesday amid an escalating row over Labour’s efforts to steal the Conservative Party’s traditional mantle as ‘the party of business’.

Sky News contacted all 15 of the companies represented on the prime minister’s business council to see whether their bosses would publicly endorse the Tories, but none agreed to do so.

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Among the companies whose executives sat on the council – which is thought to have met no more than twice since its launch in January – were BT Group, ITV, Nationwide and Unilever.

Rolls Royce Holdings, the aircraft engine manufacturer, agreed to let its Derby headquarters be used for a campaign speech by Rachel Reeves, the shadow chancellor, on Tuesday, but said it remained neutral.

Its chief executive, Tufan Erginbilgic, has also been a member of Mr Sunak’s business council since its launch.

Some of the 15 companies failed to respond to enquiries from Sky News, while others said either officially or on an unattributable basis that they would remain politically neutral during the election campaign.

One of those involved said its chief executive’s participation in the council was aimed at contributing views in order to influence government policy.

“[Their] involvement is not a direct endorsement of the governing political party’s views as these will be many and varied,” the company said, speaking on condition of anonymity.

Although that neutrality is not unusual for the bosses of major public companies, it highlights the difficulty that the Tories will have in the lead-up to 4 July in persuading major corporate names to publicly back the party.

The Tories have historically trumped Labour in securing public endorsements from big business, but were beaten out of the traps this time with a pro-Labour letter signed by more than 120 businesspeople and published on Tuesday.

None of the signatories of the Labour letter are serving FTSE-100 chief executives, with the only current public company heavyweight on the list being Andy Higginson, the chairman of JD Sports Fashion.

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Ian King, Sky News’s business presenter, revealed later on Tuesday that a number of the companies listed as supporters were dormant, while one of the signatories, WPP executive Karen Blackett, had already left the company she was cited as working for.

Labour also came under fire from Unite, the trade union, for trumpeting the involvement of John Holland-Kaye, the former Heathrow Airport chief executive, because of his use of controversial ‘fire and rehire’ processes during the pandemic.

In the pro-Labour letter, the business signatories said that Britain’s economy was “beset by instability, stagnation, and a lack of long-term focus”.

Sky News revealed last week that the Tories have contacted business leaders since Mr Sunak called the election, asking them to take part in broadcast media opportunities, provide quotes in support of manifesto pledges and host events and visits for cabinet ministers.

Those efforts are being spearheaded by Lord Petitgas, the former Morgan Stanley executive, who for months has been the prime minister’s special adviser on business.

Tory insiders dismissed the Labour letter as “a damp squib” which showed that Sir Keir Starmer and Ms Reeves had “completely failed to win the trust of major companies in the UK”.