Posties snub chance to sell Royal Mail shares

Tens of thousands of Royal Mail (LSE: RMG.L - news) staff will this week snub their first chance to sell shares handed to them during the company's controversial £3.3bn privatisation.

Sky News has learnt that only a tiny percentage of the 123,000 workers who are eligible to dispose of Royal Mail stock had placed orders to do so by Saturday lunchtime.

Sources said the vast majority of employees appeared to have heeded a recommendation by the Communication Workers Union (CWU) to hold onto their shares, with the prospect of a tax-free gain if they do not sell until October 2018.

A person close to Royal Mail said he expected "a few thousand" staff at most to place orders to sell their shares by Monday afternoon.

Equiniti, which administers employee share schemes at dozens of blue-chip companies, is understood to be overseeing the Royal Mail selldown, with an investment bank expected to be hired to place the shares only if there is a surge in demand.

Approximately 140,000 Royal Mail workers were allocated more than 600 shares when the company was floated by the Conservative-led coalition Government in 2013.

Those shares are now worth over £3,000 per employee based on Friday's closing share price of 496.9p.

The Royal Mail sell-off was bitterly opposed by unions in the period leading up to the flotation.

A political row over the privatisation deepened when the shares - priced at 330p - immediately soared by more than 30%, eventually peaking above 600p.

The Business Secretary at the time, Sir Vince Cable, dismissed the surge in the share price as "froth", although the National Audit Office concluded that more could have been done to deliver value for money for taxpayers.

Under the employee share plan, staff were initially handed 613 shares each, with a further 112 allocated to them in 2014.

From next week, a total of 71m shares can be sold by Royal Mail workers, who collectively own 12% of the company.

Employees were gifted 1% of the company a year ago by Sajid Javid, Sir Vince's successor, in a move which drew criticism from the permanent secretary at the Department for Business, Innovation and Skills.

Royal Mail and Equiniti declined to comment on Saturday, while the CWU did not respond to a request for comment.