UK government plans to increase Royal Mail shares to cater to small, public investors
UK newspaper The Guardian concluded that the British government would be planning to increase the volume of shares to be sold in the GBP3 billion initial public offering of Royal Mail. The decision reportedly was done to address the outcry of public who would not wish for banks, hedge funds and financial institutions to obtain a controlling percentage in the universal postal service. The IPO of Royal Mail would stand to be the biggest privatization deal since the sale of the government railways in the 1990s.
British Labour Party politician and shadow business secretary said, "This is turning into a dream and a bonanza for City speculators and hedge funds, meanwhile the taxpayer ... is getting massively shortchanged."
Business minister and manager of the IPO Michael Fallon said, "No decisions have been taken on allocation but I'm committed to making sure smaller investors get their fair share." 30% of the shares to be sold in the IPO were initially alloted for public investors.
60% of Royal Mail would be sold on Friday on the UK bourse. 10% of the postal service's shares would be given to the 100,000 employees of Royal Mail.