Royal Mail privatisation to deliver around £2bn to £3bn less

[TrueBlueTerrier]

Royal Mail privatisation to deliver around £2bn to £3bn less than hoped

http://www.thisismoney.co.uk/money/mark ... paign=1490" onclick="window.open(this.href);return false;

The privatisation of Royal Mail will raise less for the Government than first thought, it emerged last night.

The biggest sell-off since the railways, early indications had put the value of the business at up to £4billion.

But now Whitehall estimates suggest it could be worth a more modest £1bn-2bn – large enough to put Royal Mail in the FTSE 250 index with a shot at the blue-chip FTSE 100 if shares rise.

The eventual price – which still has to be determined – is likely to be at the lower end of expectations, it is understood.

It is thought ministers do not want to overprice shares before the sale, in case they fall sharply once trading starts – which would be an embarrassment in the run-up to the election.

Business minister Michael Fallon has said he wants the deal done this financial year, fuelling speculation that an intention to float on the London Stock Exchange could be announced as early as September.

The move will echo major sell-offs such as British Gas and BT, both privatised under Margaret Thatcher and the Conservatives.
And like the privatisations of the Thatcher era, Royal Mail’s 130,000 workers are likely to receive stakes in the company worth up to £2,000 each, claims reports.

[Donk]

It is thought ministers do not want to overprice shares before the sale, in case they fall sharply once trading starts – which would be an embarrassment in the run-up to the election.

So, the value of RM is linked to the govt's estimation of their chances at an election???