France to inject €2.7bn into post office

France plans to invest €2.7bn into the post office to prepare it for competition after the liberalisation of most of Europe’s postal services in 2011, report Reuters. The post office will become a limited company but shares will only be sold to public sector investors, according to a bill which the government hopes will be passed before the end of the year.

The move to transform the state-owned La Poste, which employs nearly 300,000, into a limited company had originally been intended to prepare the way for a partial privatisation.

“La Poste is emblematic of the French public service,’ said Industry Minister Luc Chatel, explaining why the government had decided not to privatise.

“We specifically wanted to write into the bill the fact that 100 percent of the capital will stay public.”

The EU’s members last year adopted laws to open all national mail markets to full competition — in the face of bitter opposition from the sector’s labour unions.

Unions fear the government’s plan to turn La Poste into a limited company is still the first step towards privatisation.

“In the public sector there are companies where the private shareholders play an important role,” the Force Ouvriere union said in a statement.

The state bank, Caisse des Depots (CDC), will provide €1.5bn and the state will pay €1.2bn to help the post office get in shape for competition.

La Poste has a turnover of about €20bn and is the second largest postal group in Europe. It has around 29m clients for its banking activities.