THE COALITION is pushing ahead with plans to hand employees at least 10 per cent of the shares in Royal Mail, with Britain’s biggest privatisation in two decades lined up for this year.
Although the government is continuing to explore all options for the state-owned postal service – including the sale of a stake to a private equity firm – banks are increasingly confident that a stock market launch is possible this year.
London’s previously moribund IPO market has also shown signs of life following last week’s float of housebuilder Crest Nicholson.
Heavily unionised Royal Mail staff – who mainly oppose the privatisation – will be placated with free shares or options to buy discounted stock in the company, which has been valued at up to £4bn and would be a candidate for inclusion in the FTSE 100.
Efforts to sell the business have accelerated since its pension debt was separated from the company last year, while UBS tested investors’ appetite for the deal before Christmas.
In November Royal Mail announced a rise in half-year profits from £12m to £144m, largely thanks to an increase in parcels business thanks to the online shopping boom.