Royal Mail share offer slammed

U.K. Business Secretary Vince Cable
said employees of Royal Mail Group Plc will be able to buy at least 10 per cent
of the shares in the company when the government legislates to allow private
investment.

“Employees in Royal Mail will
benefit from the largest employee share scheme of any privatization for 25
years,” Cable told the Liberal Democrat party’s annual conference.

The U.K.’s 360-year-old service is
struggling to compete with TNT NV of the Netherlands, Deutsche Post AG’s DHL
Worldwide Express unit and Business Post Group Plc as European Union rules
phase in competition for deliveries between 2011 and 2013.

A report for the government this
month recommended the sale of a stake in the postal service or an initial public
offering. The report by Richard Hooper, a former communications regulator,
found the current system of funding is “unsustainable” and called for private
investment.

The general secretary of the
Communication Workers Union, Billy Hayes, dismissed Cable’s plan.

“Any offer of shares to employees
is deeply patronizing for people who have invested their working lives in
this public service,” Hayes said in an e-mailed statement. “The British public
currently owns 100 per cent of Royal Mail and now 90 per cent is to be sold off
to the banks and financial institutions that have created Britain’s current financial
crisis.”

The Postal Services Bill, which
will be introduced to Parliament within weeks, will include a provision for
postal deliveries to be cut to five days a week from the current six in the
future, though such a step would need the approval of lawmakers.

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