(Reuters) - The British government on Thursday plans to announce an October flotation of shares of its Royal Mail postal service, Sky News reported on its website without citing sources.
The 497-year-old institution is being listed in October to help fund the modernization of its delivery networks using private cash, in what would be the country’s largest privatization in decades.
Ministers are likely to decide on Wednesday evening to go ahead with the October privatization and announce at 7 am on Thursday their plans for Royal Mail’s stock market floatation, Sky News said on its website.
The Department of Business, Innovation and Skills said no final decision had been taken about the timing of the IPO and Royal Mail declined to comment.
Sky added that Lansdowne Partners and Standard Life Investments were among institutions that have hinted at investing in Royal Mail, despite fierce opposition to the privatization from the Communication Workers Union (CWU).
The CWU, which represents most of the delivery service’s 150,000 staff, this month said it would send out strike ballot papers on September 20 if an agreement could not be reached with the government about post-privatization pay. The CWU rejected Royal Mail’s three-year pay offer in July.
As part of the flotation, the government is handing a 10 percent stake in the firm to Royal Mail staff for free.
In the past 19 years the British government has made three unsuccessful attempts to privatize the Royal Mail.
Goldman Sachs (GS.N) and UBS UBSN.VX are acting as lead advisers for the latest planned share sale.
Reporting by Richa Naidu in Bangalore; editing by Andrew Hay