TNT withdraw credit from postal market

TNT Post part of the TNT group that Lord Mandelson has lined up to buy a major stake in Royal Mail is pulling credit lines.

Whilst Lord Mandelson attempt with the inept Chancellor to increase credit availability, his suitor for Royal Mail is doing the opposite.

It appears that over in Amsterdam TNT's insurers have decided they will only insure major blue chip corporates such as Utilities. TNT have therefore decided they will withdraw credit facilities from long term clients that have always paid on time and have no real risk.

This has effectively once again brought the postal network to monopoly status for the vast majority.

The question is what would happen if TNT did get its share of Royal Mail. Would we see thousands of companies lose credit facilities.

It also begs the question as to what TNT's own financial position is if it is totally in the power of insurers; Indeed can it afford to buy the Royal Mail?

LA is still intrigued to know why TNT has been chosen by Mandelson, LA has visited TNT Posts operations and seen the same inefficiency and old fashioned practices that the Royal Mail has like a cancer.

LA also note the Royal Mail "profits". Take off the £200m government bung and it made a loss.Remove the far far above inflation price hikes and it made a loss.

Why does Deutsche Post make 10 times the profit without fiddling the figures.

RM needs to change, see earlier blogs with the Royal Mail tag.

LA is annoyed.