Staff to get up to 1% more shares

[POSTMAN]

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The British government on Wednesday said it would sell half of its remaining stake in Royal Mail (RMG.L), leaving it with about 15 percent of the postal service that was wholly state owned until 2013.

Chancellor George Osborne said last week he would sell the government's holding, which is worth about 1.5 billion pounds, as part of a renewed push in his drive to wipe out the budget deficit.

The shares are likely to be priced at 500 pence each, after a source close to the sale said potential investors have been told orders below that level risk missing out.

The 2013 privatisation of the 500-year-old postal operator attracted criticism from rival politicians and trade unions who said the firm had been sold off too cheaply after the shares quickly rose as much as 87 percent.

The government said on Wednesday current market conditions represented a good opportunity to achieve value for the taxpayer.

In a speech later on Wednesday, Osborne said the government would also award up to 1 percent more of Royal Mail's shares to staff, after giving them 10 percent of the company when it was privatised in 2013.

The shares, trading at 516.5 pence on Wednesday, are close to a one-year high.

BofA Merrill Lynch, Goldman Sachs and J.P. Morgan are acting as book runners for the placing with institutions, and the government said an accelerated book build would begin with immediate effect.

Sources told Reuters that books for the share sale had been covered.

[wandle]

So, using very crude mathematics, if giving staff 10% of the shares resulted a total of 729 shares each for full-timers, then giving away 1% of the company's shares should produce an additional allocation of 72.9 shares?

But as some people have taken VR or retired since the float in 2013, that should mean the new allocation should be at least 73 shares each ...

73 @ 500p = £365

A lot better than the poxy £61 the CWU 'negotiated' for us

[1969tonka]

Just wondering if they will be held for at least 3 years like the 729 or if we can sell them straight away ?

[cloherty1976]

So, using very crude mathematics, if giving staff 10% of the shares resulted a total of 729 shares each for full-timers, then giving away 1% of the company's shares should produce an additional allocation of 72.9 shares?

But as some people have taken VR or retired since the float in 2013, that should mean the new allocation should be at least 73 shares each ...

73 @ 500p = £365

A lot better than the poxy £61 the CWU 'negotiated' for us

[deltaforce]

So, using very crude mathematics, if giving staff 10% of the shares resulted a total of 729 shares each for full-timers, then giving away 1% of the company's shares should produce an additional allocation of 72.9 shares?

But as some people have taken VR or retired since the float in 2013, that should mean the new allocation should be at least 73 shares each ...

73 @ 500p = £365

A lot better than the poxy £61 the CWU 'negotiated' for us

I make it nearer 25 shares each. Either way it's not going to change too many lives.

[RobertT]

Just wondering if they will be held for at least 3 years like the 729 or if we can sell them straight away ?

Full timers received 613 shares on 15th October 2013 and then another 116 on 9th April 2014, so you will not be able to sell either lot until at least 3 years after those dates, assuming you’re not leaving on ‘good terms’. Although you will be paying 32% in tax & NI if you sell before 5 years.

I assume this new allocation and the extra few we’re all going to get from ‘bad leavers’ will have the same 3/5 year rule attached.

[nataddick]

Wandle-agree with your maths on 2 counts - the simple 1% rule (being 10% of what we got last time) depending on f/t to p/t split. A second simple check is that if we got £61 on a £8m profit pot then on a pot worth £50m which is 6.25 times bigger we should get 6.25 times £61 or £381.Compared to 73 shares at a fiver equals £365.

[El-Bandito]

So as the government only sold off half of their remaining shares, I take it we will get another 1% when they sell the lot?

[wannabeek]

That'd be great, but our 1% is coming out of their last remaining 15% as I understand it, giving them a further 14% to sell in the near future.

[El-Bandito]

So 0.9% then?

[El-Bandito]

We still got ripped off as the share price on initial release was 330p. Full timers should have had closer to 1500 shares not 800 .

[wannabeek]

Huh? Doesn't matter what the share price was or is. If it was priced at 500p a share back then we'd have got 10% (now 11%), being a set number of shares; if it was priced at 330p a share we'd have got the same 10% (11%) and the same number of shares. Just means those same shares are worth more now than they were then.

[paulsmd]

So, using very crude mathematics, if giving staff 10% of the shares resulted a total of 729 shares each for full-timers, then giving away 1% of the company's shares should produce an additional allocation of 72.9 shares?

But as some people have taken VR or retired since the float in 2013, that should mean the new allocation should be at least 73 shares each ...

73 @ 500p = £365

A lot better than the poxy £61 the CWU 'negotiated' for us

I think you have got that wrong, I`m not sure but last time they sold off 49% of the shares. This time they are only selling 15%.

[wannabeek]

Last time they gifted 10% to staff, kept 30% and sold the remaining 60% on the stock market.

I don't think I ever knew what percentage of that 60% was offered to their hedge-fund cronies at a reduced rate before putting the rest on the open market (which was massively over-subscribed by the public and they were only allowed reduced proportions at the float price rate) but I think it was stated to be about 150 million pounds worth.

[wandle]

I think you have got that wrong, I`m not sure but last time they sold off 49% of the shares. This time they are only selling 15%.

NO. Last time they GAVE us 10% of the entire share capital of the company (shares). Now, they are proposing to give us 1% of the entire share capital of the company (shares).

Therefore, we will receive a number of shares equating to approximately 1/10th of what we got last time, rounded up to reflect the slightly smaller number of people employed, compared to the 2013 allocation. So, 1/10th of 729 will be at least 73 new shares