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Royal Mail gears up for £3bn float
The Government is set to push ahead with plans to privatise Royal Mail this year in a £3bn float, as profits at the group continue to impress.
The state-owned postal service is understood to be set for a bumper year in terms of profits, and this could pave the way for it to be floated in London at some point this year, according to a report in the Sunday Times.
Coalition ministers are understood to be on course to appoint banks to act as book runners by the end of this month, with the share sale valuing the business at £3bn.
Some groups have fared well since privatisation and now form an important part of the UK stock market.
These include British Gas – now listed under the name BG Group – which was semi-privatised in 1986.
Under the terms of the plans, at least 10% of any shares issued would be ear-marked for the workforce.
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Shares could also be attractive to fund managers and other investors if its recent turnaround continues.
Royal Mail has reaped the rewards of the boom in online shopping, reporting first half operating profits of £99m so far this year, up 12%, and this is tipped to continue to rise, according to the report.