Investing.com -- London-listed shares in International Distribution Services (IDS) were higher in early afternoon trading on Wednesday after the Royal Mail (LON:IDSI) owner announced that it had agreed to a 3.57 billion pound ($4.55 billion) takeover by Czech billionaire Daniel Kretinsky.
The stock was exchanging hands at 333.60 pence as of 07:38 ET (11:38 GMT), well below the deal's price of 370 pence per IDS share, in a potential sign of investor caution around an agreement that will likely be subject to regulatory scrutiny.
Finance Minister Jeremy Hunt has said that any offer for Royal Mail will receive the "normal" amount of review by British authorities, Reuters reported. Analysts quoted by the news service suggested that the upcoming U.K. election in July could factor into how the deal is received.
In a statement, Kretinsky's EP Group vowed to undertake certain measures for the "safeguarding and protection" of the 508-year old Royal Mail postal service, including a commitment to keep the company's headquarters in the U.K. and recognize its postal workers' union for at least five years.
A spokesperson for the U.K.'s Labour Party, which is widely tipped to win the general election on July 4, said it would "ensure these [assurances] are adhered to," media sources reported.
EP argued that, despite recent "significant challenges" posed by intensifying competition and waning market share, IDS remains a strong business with "the potential to become one of the leading postal logistics groups in Europe."
"IDS' market is evolving quickly, and it must accelerate its transformation and investments into modernisation to keep up with the competition. We will support the business in the next critical phase of its transformation and beyond, providing our experience and financial resilience to support the management team," Kretinsky -- who also holds stakes in British grocery chain Sainsburys and soccer side West Ham United -- said in a statement.
Reuters contributed to this report.