Instant profit of 20p a share expected on BT

THE BRITISH PUBLIC will pay 410p a share in the pounds 5bn sale of the Government's remaining stake in British Telecommunications, it was revealed yesterday, writes Mary Fagan. But institutions around the world will have to pay 10p a share more - 420p.

Most private UK investors could pay even less - they are entitled to a further discount of up to 20p, or bonus shares, depending on how long they keep their stakes.

Dealings in the partly-paid shares start this morning, with some City analysts predicting an instant 20p a share gain for early sellers. But the Government has warned investors who sell before receiving their share certificates that they risk selling shares they have not got.

The Government has strongly favoured existing shareholders and employees in the way it has dealt with the offer, which was heavily over-subscribed. The share offer to institutions worldwide was six-times subscribed.

First-time individual investors, other than BT employees, have been limited to 375 shares, unless they bought through a high street share shop, in which case they get a maximum of 600 shares.

But in both cases those who applied for more than the respective limits receive nothing.

The Government will get more than pounds 3.5bn from the sale this year, with the remainder to come next year. The initial instalment payable for the shares is 160p for institutions and 150p for the UK public, with further amounts payable next March and October.

Details, page 22