LONDON: Britain's government on Thursday officially launched plans to
privatize more than half of Royal Mail, saying an initial sale of shares
in the state-run postal service would occur within weeks.
"Her Majesty's Government today announces its intention to proceed with
an initial public offering of Royal Mail," said a joint statement, which
added that the IPO was "expected to take place in the coming weeks".
Royal Mail is to list on the London Stock Exchange, while the coalition
government said it would "retain flexibility around the size of the
stake to be sold".
The government had in July announced plans to privatize more than 50
percent of Royal Mail following a major restructuring of the
organization in recent years, triggered by fierce competition from
email.
Royal Mail was expected to be Britain's biggest privatization since the
1980 sell-offs of former nationalized giants British Gas and British
Telecom.
Media reports say the part sale of Royal Mail could be worth up to £3.0
billion ($4.74 billion, 3.57 billion euros). The government previously
said that it would take on Royal Mail's historic pension deficit.
"This is an important day for the Royal Mail, its employees and its
customers," business secretary Vince Cable said in Thursday's statement.
"HM Government is taking action to secure a healthy future for the
company. These measures will help ensure the long term sustainability of
the six days a week, one-price-goes-anywhere universal postal service.
"By announcing today that we intend to move ahead with a sale of shares
in Royal Mail, we are completing the third and final part of the reforms
agreed by parliament two years ago."
Cable, a member of the Liberal Democrats which share power with Prime
Minister David Cameron's Conservatives, confirmed Thursday that 10
percent of Royal Mail shares would be handed out to its employees free
of charge.
Around 150,000 staff will be eligible to get a free stake in the
business under Britain's largest employee share scheme of any major
British privatization for almost 30 years.
The government has argued that partial privatization will allow Royal
Mail the freedom to raise capital, continue modernizing and meet booming
demand for online shopping delivery.
Royal Mail recently enjoyed a surge in annual profits thanks to the
increasing popularity of online shopping which generates parcel traffic,
and owing also to deep cost-cutting and big increases in stamp prices.
The coalition government relaunched plans to part-privatize Royal Mail
three years ago and after the proposal was ditched by the former Labour
administration.
Former prime minister Gordon Brown's Labour government scrapped the
sell-off plans in 2009 as Britain struggled with recession following the
global financial crisis.
Royal Mail continues to operate most British postal services even though
its more than 350-year-long monopoly of the letter-delivery business
ended in 2006 as new rules kicked in to allow rival operators.
While Brown's Labour government was seeking to offload a big chunk of
the Royal Mail, it was also forced to nationalize or rescue several
major British banks at the top of the global financial crisis in 2008.
Source :
No comments:
Post a Comment
Note: only a member of this blog may post a comment.