UK Government plans to split Consignia into 2 companies
RBC NEWS 7th October 2001
UK GOVT PLANS TO SPLIT CONSIGNIA INTO 2 COS – REPORT
Section: COMPANY NEWS
LONDON (AFX) – Consignia, the renamed Post Office, will be split into two companies under a radical proposal being examined by the government, the Sunday Times reported without citing sources.
It said ministers are considering a plan to merge Royal Mail and Parcel Force into one company and put Post Office Counters (POC), which runs the network of 17,800 regional post offices, into another. Each company would have a separate board and management structure.
The scheme has been discussed at senior level within both Consignia and the government. It forms part of the 1.2 bln stg programme that was announced by the company last week to cut the group’s costs by 15 pct.
POC has become a financial drain for its sister companies. It is currently losing 120 mln stg a year, and the losses will increase after 2003 when the government introduces electronic benefit payments, the newspaper said.
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