This week the state-owned Royal Mail postal service moved forward with its plans for privatisation by employing the services of two banks (Goldman Sachs and Bank of America Merrill Lynch) as advisors in the ownership transition, whilst British-based Barclays have already been assisting them for some time. In addition to this, UBs have been directly advising the government for some time on one of the largest and most significant privatisations of a state owned industry since the Conservative governments of Margaret Thatcher and John Major.
Royal Mail has released an official statement, which says that the two new advisory additions would give them “additional support relating to early investor soundings to assist with Government decision-making on the form and timing of a future sale”.
It is understood that both the Royal Mail, advisors and the Government would prefer a stock market flow, as opposed to an outright sale. With around 150,000 staff and sales of £9.5bn, stock market floatation is likely to result in a public offering of between £2bn and £3bn.
Officials have been keen to announce that no formal decision has been taken and that they will consider all possible avenues before making their final decision, which is likely to be taken in either 2013 or 2014.
Some sources have predicted that a stock market floatation could be on the cards as soon as the third quarter of 2013. However, Moya Greene, the chief executive of Royal Mail, has stated that if it is to happen, it is more likely to be in the first quarter of 2014.