LONDON —
Shares in Britain's Royal Mail postal service opened at 450 pence in their London stock market debut on Friday, 36 percent above their privatization price.
The rise will fuel the debate over whether the sale, one of Britain's biggest privatizations in decades, was priced too cheaply. This comes following criticism from the opposition Labour party that the government was short-changing taxpayers.
The hugely oversubscribed sale of a majority stake was priced at 330 pence per share on Thursday, the top of its expected range. That price valued the near 500-year-old company at 3.3 billion pounds ($5.3 billion).
Trade union members, who opposed the sale and are balloting for strike action, were due to hold a protest outside the London Stock Exchange on Friday.
“There's no celebrations in delivery offices around the country today,” Communication Workers Union General Secretary Billy Hayes told BBC Radio.
“The real test of whether the staff are happy with this privatization will be next Wednesday, when we expect to declare a yes vote for strike action,” continued Hayes.
Royal Mail's public offering leaves the government with a 38 percent stake, but this could fall to 30 percent should it choose to exercise an over-allotment option, whereby extra stock can be sold if there is strong demand.
The shares are trading conditionally until Oct. 15, meaning that in theory if the sale was cancelled all trades would be void.
As of 0714 GMT the shares were trading at 449 pence, having hit a high of 456 pence earlier.
The rise will fuel the debate over whether the sale, one of Britain's biggest privatizations in decades, was priced too cheaply. This comes following criticism from the opposition Labour party that the government was short-changing taxpayers.
The hugely oversubscribed sale of a majority stake was priced at 330 pence per share on Thursday, the top of its expected range. That price valued the near 500-year-old company at 3.3 billion pounds ($5.3 billion).
Trade union members, who opposed the sale and are balloting for strike action, were due to hold a protest outside the London Stock Exchange on Friday.
“There's no celebrations in delivery offices around the country today,” Communication Workers Union General Secretary Billy Hayes told BBC Radio.
“The real test of whether the staff are happy with this privatization will be next Wednesday, when we expect to declare a yes vote for strike action,” continued Hayes.
Royal Mail's public offering leaves the government with a 38 percent stake, but this could fall to 30 percent should it choose to exercise an over-allotment option, whereby extra stock can be sold if there is strong demand.
The shares are trading conditionally until Oct. 15, meaning that in theory if the sale was cancelled all trades would be void.
As of 0714 GMT the shares were trading at 449 pence, having hit a high of 456 pence earlier.
