PostNL, the former Dutch state postal monopoly, is taking over its main competitor Sandd for €130m, the two companies announced on Monday. The government last year said it would allow postal delivery firms to merge to cope with declining volumes of mail.

PostNL currently controls some 70% of the Dutch postal market and Sandd virtually all the rest – primarily business deliveries. The takeover must first be approved by the Dutch competition authority ACM.

This deal will ‘secure the foundation for a sustainable postal service in the Netherlands,’ PostNL chief executive Herna Verhagen said in a statement.

‘Combining the two national postal networks is of vital importance for the postal market in the Netherlands to remain reliable, affordable, innovative and accessible for everyone.’

‘Opting for one strong national postal network is the best long-term solution for the consumer, the business sector and for employees,’ Sandd managing director Ronald van der Laan said. ‘It is the only solution if we are to guarantee the continuity of the postal service in the Netherlands.’

PostNL will also ‘offer to employ Sandd delivery workers’, many of whom are officially freelancers. PostNL has a workforce of 38,000, of whom 18,000 are delivery workers. Sandd has 19,000 workers, of whom 16,000 deliver mail.

Shrinking market

Sandd delivered 720 million items of post last year,  PostNL 1.7 billion but the market is shrinking by around 10% a year.

Last June the government cleared the way for a merger when junior economic affairs minister Mona Keizer said the shrinking postal market presents major social and economic challenges.

While competition is important, it should no longer be a goal in itself, Keizer said. The current situation has led to ‘two or three postal delivery workers walking through the same street, each with increasingly empty bags,’ the minister said.