Flogging Royal Mail to faraway owners is a gamble that may go horribly wrong for Labour

It is hard to see why the performance of Royal Mail should improve beyond what it could have achieved under its own steam

- Nils Pratley

Two general elections ago, Labour was promising to renationalise Royal Mail. Now, in office, it is happy to see the ancient institution fall to a leveraged takeover bid from a private equity-style firm that will have the power to set the price of a first-class stamp from Prague. The decision is an outright gamble. Many European countries have privatised their postal services but there is a good reason why none has allowed ownership to pass overseas. Even in a digital age, businesses such as Royal Mail provide critical national infrastructure that has a social value on top. Naturally, the boasts from the government on day one were about the supposed robustness of the undertakings agreed with EP UK Bidco, the takeover vehicle owned by Daniel Křetínský, the multibillionaire Czech tycoon, and his 44% co-investors, J&T.

And it is true there were welcome tweaks to the original version that was unveiled when the board of International Distribution Services, Royal Mail's parent, rolled over in May and surrendered for 370p a share, or £3.6bn. The UK government will get a golden share in Royal Mail, for starters, to give it a permanent say in the governance set-up and tax location.