Photograph by Monica Arellano-Ongpin
The government has given formal notice to the London Stock Exchange that it is preparing for a floatation of the privatised business “in the coming weeks”.
10% of the shares of the privatised company will be distributed amongst Royal Mail’s 150,000 employees, with more shares offered to institutional investors and members of the general public. The smallest investment available in the newly formed public company by members of the public will be £750, with Royal Mail staff able to apply for an employee priority offer for a minimum £50.
The government has said that they had not decided the exact proportion of the business to sell, and would await news of investor interest before making that decision, although they do plan to sell of a majority share.
As the government moves the company towards privatisation, the Communication Workers Union balloting its members over strike action over the floatation, pensions, and pay, with the results of this vote to be announced on the 3rd October. This leaves the possibility that as Royal Mail becomes listed on the stock exchange, 125,000 of its workers will be on strike, bringing the service to a standstill.
Billy Hayes, CWU general secretary, said:
“We remain convinced that privatisation is the wrong decision for Royal Mail. It would be bad for customers, bad for staff and bad for the industry. Privatisation would put jobs and services at risk and lead to higher prices for customers. We’ve seen it happen time and again in other industries.”
The sale of the Royal Mail will not affect the Post Office and rural post offices around the country for the time being, with the Royal Mail and the Post Office signing a ten year agreement in 2012.
