The privatisation of the Royal Mail will take place in mid-October, ahead of a planned strike by postal workers, the Government announced today.
Shares will be priced at between 260p and 330p, valuing the business at up to £3.3bn, according to a prospectus issued by the Department for Business. Ministers’ decision to press ahead with the controversial sale before industrial action by postal workers was heavily criticised.
Ballot papers on a strike went out to more than 100,000 members of the Communication Workers Union (CWU) yesterday. Voting will close on 16 October, with strike action highly likely to be endorsed. It would take place the following week.
The Government is selling a stake of between 50.1 and 70 per cent in Royal Mail, arguing that private investment is essential to help it compete for the lucrative and rapidly growing parcels delivery market.
A 10 per cent stake will be distributed among staff, with at least 40.1 per cent sold to private investors. Trading in the shares is due to begin on 15 October.
Vince Cable, the Business Secretary, said: “This will give Royal Mail access to the private capital it needs to modernise.”
But Billy Hayes, the CWU general secretary, said: “Royal Mail is profitable and can continue to be successful in the public sector. The sale is driven by political dogma, not economic necessity.” Len McCluskey, general secretary of Unite, criticised the “selling of a profitable service to make a quick buck to pay for [the Government’s] failed handling of the economy”.
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