The Government has given An Post the go-ahead to enter into negotiations on a strategic alliance with one of the major European postal operators. Negotiations can also begin on an Employee Share Ownership Scheme. An Post has been seeking permission for a strategic alliance. Last February, the European Council passed a directive allowing for private companies to compete in the postal market, in terms of transporting larger packages. That decision has taken an estimated £16m or 4% from An Post's revenue. Across Europe, postal companies are linking up and this is reducing their costs.
As this “liberalisation” continues, An Post believes that they need a strategic alliance to compete in the changing market. The decision to allow negotiations begin for a strategic alliance could pave the way for the break up of An Post. That is, a foreign company may wish to either buy a stake in the company or perhaps, an aspect of the business. It is unlikely that the government will want to fully privatise An Post and Minister O’Rourke announced this evening that she is asking An Post to allocate £5m pounds to the upgrading of rural post offices. Staff is also likely to want a share. As with Eircom, staff will probably look for somewhere between 10% and 15% of the company although they may not get that amount.
The government, however, has given the go-ahead for negotiations to start on an employee shared ownership scheme. There are three companies being mentioned as possible partners to form this strategic alliance. Britains' postal service Royal Mail, which has recently made an acquisition in Ireland, and the German and Dutch postal services are also believed to be among the interested parties.
