Barclays Plc (BARC) will be joint bookrunner and sponsor, and Bank of America (BAC) Merrill Lynch will be joint bookrunner for the deal, the Department for Business, Innovation and Skills in London said in an e-mailed statement today. No final decision has been taken about how or when to sell Royal Mail, according to the statement. The government has said its preferred option is an initial public offering by the end of the current financial year next March.
“While all options for the form of sale remain open, it is important that we are in a position to move ahead swiftly with our chosen route once we take the final decision,” Business Minister Michael Fallon said in the statement. “The appointed banking syndicate will work to make sure we are ready to proceed when the time comes and will be able to deliver strong, high-quality investor demand to ensure a successful IPO for the taxpayer and for Royal Mail.”
The planned sale of Royal Mail will be the largest privatization in Britain since former Prime Minister John Major broke up the country’s railway more than a decade ago. The 360-year-old company, one of the nation’s biggest employers with about 159,000 staff, has sought to adapt its letter-focused network to more lucrative package delivery in the face of competition from TNT NV of the Netherlands and Deutsche Post AG (DPW)’s DHL Express unit.
Royal Mail’s operating profit more than doubled in the year to March 31 to 403 million pounds ($609 million) as growth in web-based shopping spurred parcel deliveries, the company said in a statement last week. While sales gained 5 percent to 9.28 billion pounds, parcel revenue rose 9 percent.
Royal Mail appointed Equiniti Group this month to manage the distribution of 10 percent of its shares to employees following any sale.
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