Profit rise to pave way for Royal Mail float


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The Independent Online

Royal Mail boss Moya Greene is ready to deliver on plans for the most high-profile privatisation since the railways nearly 20 years ago.

Separate reports over the weekend suggested that Royal Mail will unveil a surge in its half-year profits tomorrow, a key proviso of a flotation in the third quarter of next year, and that the Government is ready to start talking to potential City investors.

A London Stock Exchange listing could value Royal Mail at as much as £4bn, meaning it would immediately gatecrash the FTSE 100 index of the country's biggest companies.

Despite sales of £9.5bn, Royal Mail has often struggled to make a profit, particularly in its core Parcels, International, Letters division.

However, Ms Greene, right, has slashed jobs and has made sure that Amazon became Royal Mail's biggest client as part of a root-and-branch restructuring that the Canadian has undertaken since joining Royal Mail two years ago.

Ministers are said to have approved a roadshow of major investment firms in the new year. The Government has also made a commitment to letting employees buy shares as well as making them easily available to the public.

UBS and Barclays are advising the Government and Royal Mail respectively.

Postal unions are set against privatisation, though the Post Office would not be part of the flotation.