Deutsche Post buys in to UK mail market

In a major development in the fast evolving UK postal market, Deutsche Post has acquired Speedmail International, an independent company operating mail services under an interim licence from the UK postal regulators.

In the year 2002/2003 Speedmail handled 12 million items, delivering to 22 postal code areas in the London region. In January 2004 it was granted a long term licence to deliver bulk mail and the ability to offer track and trace for business to business mail.

Deutsche Post stated aim is to become a major player in the UK postal market as it becomes increasingly liberalised. The acquisition of a company with a licence to operate gives Deutsche Post an important foothold in the market. There are at present few companies with such a licence. In addition to Royal Mail and Speedmail, these include: UK Mail (subsidiary of Business Post); Express Ltd (a subsidiary of national milk delivery company Express Dairies); Hays DX Mail and TPG Post (a subsidiary of the Dutch post office).

Deutsche Post’s move may just be the start of an acquisitive strategy to build market share at the expense of Royal Mail. It is believed that both TPG and Deutsche Post have been involved in the bidding process for Hays postal business, DX Mail, which has been put up for sale by its parent company following the award of a seven year licence. Despite the competition, Royal Mail remains completely dominant, with about a 99.75% market share.