LONDON (Reuters) - The British government has invited stockbrokers to apply to help sell shares in the Royal Mail postal service to members of the public as part of a planned stock market listing.
The 497-year-old institution is to be floated by the end of March 2014, the country’s biggest privatisation in decades, to help fund the modernisation of its delivery networks using private cash.
In a statement on Wednesday, Business Minister Michael Fallon said members of the public would be able to buy shares either through intermediaries, or direct from the government.
“UK stockbrokers and share dealing services are being sent information which will outline the arrangements for acting as intermediaries in the retail offer,” the statement said.
Including a retail element is relatively rare for initial public offerings (IPOs) in Britain. While retail investors are considered to be less price sensitive, it is an option only usually considered for well known companies.
Last year insurer Direct Line sold around 15 percent of its 787 million pound IPO to retail investors who on average bought 5,000-6,000 pounds worth of shares.
The government, which plans an advertising campaign to support the sale, said the British public would be able to buy shares at the same price as institutional investors and that intermediaries would not be allowed to charge retail investors for applying for shares on their behalf.
Goldman Sachs and UBS are acting as lead advisers for the share sale.
As part of the flotation the government is handing a 10 percent stake in the firm to Royal Mail staff for free.
The Communication Workers Union (CWU), which represents most of Royal Mail’s 150,000 staff and is fiercely opposed to privatisation, has said that if a sale does proceed it would consider trying to create a workers’ trust to control the 10 percent stake, in order to hold more power over the firm.
About 80,000 Royal Mail postal staff voted to oppose the government plans in June.
The CWU said on Wednesday that staff at Royal Mail’s parcels and courier arm Parcelforce had added their voice to the opposition.
CWU sent almost 3,500 ballot papers to Parcelforce members and said that 93 percent had voted against privatisation on a turnout of 72 percent.
Reporting by Kylie MacLellan and Neil Maidment; Editing by Ron Askew and Pravin Char