The Swedish government is planning to sue the Danish state over a breach of the PostNord shareholder agreement, reports Dagens Nyheter.
There is a statutory requirement in Denmark that citizens must be able to receive digital post from the authorities. This has led to a 90% drop in letter deliveries in Denmark since 2000 and the Danish subsidiary of PostNord has seen revenues drop accordingly. With more than 3,000 employees entitled to three years’ severance pay in the event their jobs are axed, the carrier could be facing costs of SEK 6 billion. PostNord has asked the Danish and Swedish governments for a capital injection of SEK 3 billion, but Swedish Enterprise Minister Mikael Damberg has said “this is a Danish problem”. The lawsuit is seen as an attempt to force the Danes to back down
Internal documents reveal that PostNord may have “lost” as many as 5.5 million letters in 2016, reports Svenska Dagbladet.
Anders Åkesson, Centre Party infrastructure spokesperson, says this is “extremely serious” and completely undermines public confidence in PostNord.
In October 2008 the Swedish National Audit Office (Riksrevisionen) asked that it be allowed to examine the merger of the Danish and Swedish postal services but Maud Olofsson, the then enterprise minister, turned down the request saying that neither the Danish nor Swedish governments had a controlling interest in the new company, PostNord.
PostNord has been in the red since 2012 and Mikael Damberg, the current enterprise minister, has repeatedly expressed his concerns about the state of the company (ed.), saying that he has inherited “a marriage” from Maud Olofsson. According to Dagens Nyheter, he would like to see the Danish business – which is the part that is responsible for the multi-billion kronor losses – hived off.
A group of financial and legal experts is currently considering whether it is possible to separate the two businesses. Their report will be presented at the end of March, but in the meantime PostNord has triggered a political storm in Denmark with the opposition accusing the government of trying to cover up just how deep the crisis is.
DN has previously reported that the Swedish-Danish Postnord is in crisis; a picture confirmed when the company presented its losses of almost SKr 1.6 billion for 2016.
Now Enterprise Minister Mikael Damberg has called in external lawyers and financial advisers to decide how the government should move forward with Postnord.
It is mainly the Danish section that has pulled down the business and Mikael Damberg has reviewed the merger agreement. He points out shortcomings such as not having a long-term perspective and setting far too optimistic forecasts. There are also questions about how the merger’s structure was determined, as Sweden provided 70% of turnover but received only 60% of ownership.
Dagens Nyheter yesterday revealed that the Swedish government is drawing up a crisis plan for PostNord, which it owns together with the Danish government. A working document reveals that the government is concerned over profitability and the Danish part of the business is the main problem.
PostNord Denmark has been in the red since 2012 and there are fears among Swedish politicians that taxpayers will end up footing the bill to secure Swedish postal services.
One of the problems is that while the Swedish government owns 60% of the shares, it only has 50% of the vote in PostNord. According to DN, it is virtually impossible to implement any major change, unless all board members are in agreement.
When the merger was agreed in 2008, Nutek, the Swedish agency for economic and regional growth, commented that the deal was a poor one for Sweden.
Meanwhile, Moderate MP Lars Hjälmered, the deputy chair of the parliamentary committee on industry and trade, believes measures need to be taken to ensure the Danish business makes a profit, saying. “PostNord must decide what that is, be it a change in ownership, or streamlining or whatever. But it is obvious that something needs to be done; it cannot be allowed to run at a loss.”
In a series of articles SvD has reported on postal operator PostNord’s falling revenues and inferior quality. Many readers have since contacted the paper expressing their annoyance over the operator’s poor service; one reader has told of how the operator failed to deliver an invoice from the Transport Administration in time and how he had to pay a fine of 500 kronor as a result, while others testify to the way in which letters are delivered to the wrong address, or fail to be delivered at all, and of PostNord’s indifference when they complain.