The UK government has sold its remaining 13% of shares in Royal Mail at a price of £4.55 (US$6.93) per share, raising £591.1m (US$900m) in the process. The government has also gifted 1% of the remaining shareholding to Royal Mail employees, taking the total stake in the business owned by employees to 12%.
In total, the UK government has raised £3.3bn (US$5bn) from the privatization of Royal Mail, although it still retains full control of the network of Post Office branches which remains a separate company. The relationship between the Post Office and Royal Mail is purely commercial and a 10-year contract for the delivery of Royal Mail services through post offices was put in place in 2012.
Sajid Javid MP, Secretary of State for Business, Innovation and Skills, said, “This is a truly historic day for Royal Mail with the workers gaining a share of this history. We have delivered on our promise to sell the government’s entire remaining stake which means that for the very first time the company is now wholly owned by its employees and private investors. This is the right step for Royal Mail, its customers and the taxpayer.
“Proceeds will also go to help pay off the national debt a crucial part of our long-term plan to provide economic security for working people.”
George Osborne, Chancellor of the Exchequer, said, “This is a milestone moment in the long and proud history of the Royal Mail, when we secure its long term future. By fully leaving state ownership we have a win all round for customers, the workforce and the taxpayer. And every penny will be used to pay down our national debt as we continue to bring our public finances under control.
“Once again, we are also going to recognize the hard work of the staff who have done a great job in turning the company around, and give them a 1% stake to share between them.”
October 13, 2015