Royal Mail is reportedly trying to overturn posties’ bitterness towards privatisation by offering them a sweetener in the form of thousands of pounds’ worth of shares – which they may even get for free.
Ministers are understood to be in advanced talks about giving the shareholding to staff at the postal organisation – of up to 10% – in what will be one of the UK’s biggest privatisations since the BT and British Gas sell-offs in the Eighties.
Investment bank UBS is said to have tested the appetite for a listing before Christmas and, with recent gains on the FTSE 100, plans for the flotation are advancing rapidly.
This has also been spurred on by Royal Mail’s most recent results. In November it revealed profits had rocketed by 1,200% – from £12m to £144m – in the first half of 2012, with the parcels division performing strongly.
With the pension deficit now sorted, the only things standing in the way are a new pay deal for staff, as well as share options.
A stock market flotation is only one option, however, with the Government also considering the potential for a sale to a rival or private equity fund. The privatisation plan is being led by business minister Michael Fallon.
The move comes as reports have emerged about Royal Mail staff bonuses rising by almost two-thirds last year, despite key first-class delivery targets being missed.
Managers at the postal operator received a 62% increase in bonuses from £1,674 in 2010-2011 to £2,717 last year. Chief executive Moya Greene was given a £371,000 bonus, resulting in a total salary of £1.1m.
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