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The US investment group Apollo has struck a deal to buy UK parcel delivery company Evri, handing it control of a key rival to Royal Mail as Czech billionaire Daniel Křetínský seeks to reinvigorate Britain’s main postal operator.
Apollo is set to acquire Evri from Advent International, the company’s current private equity backers, for around £2.7bn, a person familiar with the matter said.
Advent bought the business in 2020, when it agreed a €1bn deal to acquire the UK operations of the Hermes parcel delivery group from German mail-order company Otto.
The company was relaunched as Evri two years later, and now serves more than 12mn customers per week, Apollo said in a statement on Thursday.
The latest logistics deal comes just months after the Křetínský agreed a £5.3bn deal to acquire London-listed International Distribution Services, which owns Royal Mail.
It also comes amid a period of increasing competition in the UK delivery sector, which for centuries had been dominated by Royal Mail.
As the regulated postal provider has struggled with declining demand for letters, rivals including Evri have gained market share by focusing on the growing market for online shopping deliveries.
Evri delivered 14 per cent of the UK’s parcels by volume in 2022, trailing only Royal Mail and Amazon, according to mail services group Pitney Bowes.
Although historically criticised for poor service, Evri has since its rebrand focused on investments in the technology and infrastructure needed to serve consumer demand for rapid online shopping deliveries.
Evri also attracted interest from rival delivery groups as part of a months-long sales process, according to people familiar with the matter.
“Evri has built an enviable position in parcel delivery, with an innovative model, technology and infrastructure purpose-built for reliable, lower emissions delivery in the fast-growing ecommerce market,” Apollo private equity partner Alex van Hoek said in a statement.
But the planned takeover of Royal Mail by Křetínský, who intends to plough money into similar investments at the former state-owned group, could reinvigorate a key competitor to Evri and other parcel-focused groups such as DHL and DPD.
Apollo has recently acquired UK companies including Wagamama-owner The Restaurant Group, which it bought in a £506mn deal last year, and Conitiki-owner The Travel Corporation, which it agreed to buy earlier this month.