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Government sells final stake in Royal Mail for £591 million

The Government has sold its final stake in the Royal Mail for just over £591 million

A total of 13% was sold at a price of 455 pence per share, with the Government's final 1% holding gifted to eligible UK employees, raising their stake in the company to 12%.

The price is notably lower than 500p per share achieved in the most recent sale over the summer, when a 15% stake raised £750 million for the Government.

In total, it has raised £3.3 billion from the sale, with proceeds used to pay down the national debt.

Business Secretary Sajid Javid said the sale represented "the right step for the Royal Mail, its customers and the taxpayer".

He added: "This is a truly historic day for Royal Mail with the workers gaining a share of this history.

"We have delivered on our promise to sell the Government's entire remaining stake which means that for the very first time the company is now wholly owned by its employees and private investors.

"Proceeds will also go to help pay off the national debt - a crucial part of our long-term plan to provide economic security for working people."

Chancellor of the Exchequer George Osborne said: "This is a milestone moment in the long and proud history of the Royal Mail, when we secure its long-term future.

"By fully leaving state ownership we have a win all round - for customers, the workforce and the taxpayer. And every penny will be used to pay down our national debt as we continue to bring our public finances under control.

"Once again, we are also going to recognise the hard work of the staff who have done a great job in turning the company around, and give them a 1% stake to share between them."

When the Royal Mail was privatised, the Government was heavily criticised for undervaluing the organisation.

A report last year suggested it had made £180 million less from the sale of Royal Mail than it could have, as shares could have been valued up to 30p more than the flotation price of 330p given the high level of demand.

The Communication Workers Union has described the latest sale as a "disgrace".

General secretary Dave Ward said: "This fire sale nails the lie that the Tories stand up for the interests of ordinary people. By their actions today they have made it abundantly clear that they are only interested in privatisation dogma and making the rich richer - even when their actions place public services at risk.

"The remaining Government share in this profitable company should have been used to safeguard the public's voice in Royal Mail and ensure the continuation of daily deliveries to every address in the country. The Tories have instead chosen an ideological course that puts the fundamental ethos of a centuries-old national institution in jeopardy."

A Royal Mail spokesman said: "We note the Government's announcement that it has disposed of its remaining shares in the company, and welcome its gifting of a further 1% to Royal Mail employees. This will bring the total employee Free Shares holding in the Company to 12%.

"Royal Mail remains committed to the Universal Service Obligation and to delivering for all 29 million homes and businesses in the UK."


From Belfast Telegraph