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Government sells half of its remaining Royal Mail shares | |
(about 9 hours later) | |
The government has sold half of its remaining 30% stake in Royal Mail, raising another £750m for the Exchequer. | |
Postal workers will receive a 1% stake in the company worth about £50m, in addition to the 10% given to them when the government started its sell-off in 2013. | |
The remaining shares will be sold to institutional investors, such as pension funds. | |
The move has been criticised by Labour. | The move has been criticised by Labour. |
In his annual Mansion House speech in the City of London, Mr Osborne said: "We want to help the Royal Mail attract more investment and serve its customers, and use the money we raise in return to pay down the national debt." | In his annual Mansion House speech in the City of London, Mr Osborne said: "We want to help the Royal Mail attract more investment and serve its customers, and use the money we raise in return to pay down the national debt." |
"And we're also going to make sure that there is a special bonus for the workforce who have done such a great job turning Royal Mail around. | "And we're also going to make sure that there is a special bonus for the workforce who have done such a great job turning Royal Mail around. |
"Thanks to them, Royal Mail's share price has risen, so we're going to give more of the shares to the staff." | "Thanks to them, Royal Mail's share price has risen, so we're going to give more of the shares to the staff." |
But shadow business secretary Chuka Umunna MP said: "It's disgraceful the government is rushing to dump its stake in Royal Mail to City speculators without giving ordinary investors a look-in." | But shadow business secretary Chuka Umunna MP said: "It's disgraceful the government is rushing to dump its stake in Royal Mail to City speculators without giving ordinary investors a look-in." |
Last month, Royal Mail reported an increase in full-year profits as cost cuts helped the company in a "challenging" market. | Last month, Royal Mail reported an increase in full-year profits as cost cuts helped the company in a "challenging" market. |
It reported £740m in annual adjusted operating profit before transformation costs, up 6% from a year earlier. | It reported £740m in annual adjusted operating profit before transformation costs, up 6% from a year earlier. |
Revenues in the year to 29 March were barely changed at £9.4bn. | Revenues in the year to 29 March were barely changed at £9.4bn. |
UK parcel volumes grew by 3%, although revenues from its parcels business rose by just 1%. Letter volumes fell by 4%, with revenues from letters down 1%. | UK parcel volumes grew by 3%, although revenues from its parcels business rose by just 1%. Letter volumes fell by 4%, with revenues from letters down 1%. |