UK Royal Mail set for partial privatisation
Royal Mail Group PLC chairman Allan Leighton has won a private pledge from the British government that he can partially privatise the 368-year-old mail delivery company, the Mail on Sunday reported.
The paper said the decision was the price Leighton demanded for staying on at the company for another three years.
The decision to hand 20 pct of the business to workers and sell off 31 pct on the market for around 4 bln stg could put Leighton on a collision course with the powerful Communication Workers Union.
Leighton reportedly plans to use some of the proceeds from the sale towards plugging the 2.5 bln stg hole in the Royal Mail’s pension fund in an effort to quell opposition.
The paper went on to say the plan will assist him in an attempt to offer early retirement to an extra 30,000 of the company’s 100,000-strong workforce as he attempts to boost competitiveness.
The former monopoly, which still delivers some 82 mln items to 27 mln addresses each day, is under mounting pressure to cut costs after the Postal Services Act of 2000 opened up the market to competition.
The paper said the partial sale is likely to occur shortly after the next General Election, widely expected to take place next May.
