Britain embarked on its largest privatization in decades on Thursday as the government unveiled plans to sell the majority of the near 500-year-old state-owned Royal Mail postal service.
The Department for Business said a stock market flotation would take place in coming weeks, giving the public a chance to buy into the postal network. Ten percent of the shares will be given to Royal Mail staff.
It said the size of the sale would depend on market conditions and analysts suggested the flotation could value Royal Mail, which traces its roots to a service founded by King Henry VIII in 1516, at between 2 and 3 billion pounds ($3-$4.7 billion).
“HM Government will retain flexibility around the size of the stake to be sold, as this will be influenced by market conditions at the time of the transaction, investor demand and the objective to ensure that value for money for the taxpayer is achieved,” the government said in a statement.
Business Minister Michael Fallon, the man leading the sale, had told Reuters in July there was healthy demand from domestic and overseas investors in Royal Mail.
The company, which no longer includes the Post Office services and retail business, has revenue of more than 9 billion pounds and more than doubled profit in the year ended March 31, helped by a greater focus on parcels, which make up almost half its turnover.
The privatization of Royal Mail, which has around 150,000 staff, is designed to raise funds to help finance the modernization of the postal operator’s business, but has been fiercely opposed by unions concerned about threats to jobs, pay and the possible impact on services.
It will be the fourth time the group has tried to go public, after three attempts failed in the last 19 years due to opposition from within the governing majority, which feared an electoral backlash from tampering with a revered institution whose red post-boxes are known around the world.