Shell among reported bidders for Post Office telecoms business
Oil giant Shell Energy is reported to be among a number of bidders in the running to acquire the Post Office’s telecoms division. The business has around 500,000 phone and broadband customers and would reportedly be valued at around £100 million.
Sources have indicated that Post Office Chief Executive Nick Read would only accept an “attractive price” for the division. Other bidders reported to be competing in the auction are Sky and TalkTalk Telecom Group, which is currently in the midst of a shareholder-led takeover.
TalkTalk, which is currently home to around 4.2 million UK broadband customers, was recently the subject of a non-binding £1.1 billion takeover proposal from Toscafund Asset Management (TAM), which would see the company go private if successful.
Last year, the Post Office issued a Prior Information Notice (PIN) seeking suppliers for what it termed a “range of goods and services in order to continue to provide telecommunications services” for consumers. It had previously held a managed service agreement with the wholesale division of TalkTalk.
Shell Energy currently has around 130,000 broadband customers in the UK after establishing itself in the telecoms industry through its 2018 acquisition of First Utility. It is bidding for the Post Office telecoms division as Shell Energy Retail, the new name of First Utility.
An acquisition on the scale of the Post Office’s telecoms division would be transformative to the scale of Shell Energy’s broadband offering and customer base. Shell Energy is also expanding its presence in the residential utilities market through its range of smart home devices, which include electric vehicle charging.
The Post Office is conducting the auction for its telecoms business through PJT Partners and is also reported to be exploring possible options for its insurance business. All three of the reportedly interested parties have declined to comment.