Selling royal mail shares bought direct
The Royal Mail has been a millstone around consecutive governments' necks, but there have been a number of obstacles to its privatisation, not the least of which was its massive pension liabilities.
The path to a stock market listing is looking clear. Previous privatisations, like the British Gas sell-off, attracted affectionate attention from the public at large, and hopes are high that the Royal Mail has a strong enough place in the nation's hearts to bring in legions of small buyers.
Many investors, however, are put off the idea of buying into a heavily regulated business, and the Royal Mail's universal service obligation could be a pretty big disincentive. The requirement to provide the same service for the same cost, regardless of whether a package is going to another street in the same town or from Tolpuddle to Aberdeen, makes profitable pricing a tad tricky.
But a significant part of that has now been swept away, as Ofcom has decided to remove regulatory control from the prices of first class post and from most business services. Second class stamps will be capped at no more than 55p, but that could be allowed to rise with inflation. The Royal Mail has immediately responded by announcing a rise in the price of first class stamps from the present 46p to 60p from April 30, with second class going up from 36p to 50p.
Although other options, including a sale to a private equity investor, are still on the table, the government is keen for a public offering to both institutional and private investors, coupled with a "Tell Sid" style marketing campaign.
Royal Mail: How do I buy shares? | The Independent
Such a flotation will depend on next year's economic conditions, and on further improvement of the Royal Mail's financial state. But does it look like an attractive prospect to buy into? Well, in recent years the Royal Mail has been beset by all manner of problems, ranging from the increasing loss of business to competitors and electronic communications, to difficulties modernising technology and working practices.
But while good progress has been made, potential investors will want to see how finances go under the new lighter regulatory regime.
Business mail services will surely be the key to future profitability. With email, text messages, and all manner of twittery things increasingly taking over from quill and parchment, the future of letter-writing looks bleak.
And the new higher charges, while they might make the carrying of all those little envelopes more cost-effective, will surely help hasten its demise. Are you likely to want to be a part of this new offering?
It's an increasingly competitive business, and around half of the stuff I order on the Internet already comes from other shipping companies. And the bulk of my other mail consists of things like bank account and credit card statements, and those are increasingly offering paperless alternatives.
For me this planned sale is premature, and there will be political reasons for wanting it done during this parliament. But I'd really want to see a couple more years of financial improvement first before I'd consider stumping up any cash for a stake. I think it would be too much of a risk just a year from now. You'll also receive a special free report on '10 Steps To Making A Million' if you join The Motley Fool Collective today. Get help with sharing Fool. Get more details on how to take advantage of RSS feeds.
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Institutional demand made BT and British Way to trade forex on daily charts made those issues attractive propositions for stagging. I'm not sure Royal Mail will have the same dynamic. Have to agree with BrnzDrgn -from personal experience last bastion of unionism except perhaps for Rail unionappalling management living in the past and so bad that govt of all persuasions has spent the last 15 years trying to dump them.
The work force are often on strike and against modernisation because of the job losses 'modernisation' would cause. The unions dont like modernisation and I dont like unions so I selling royal mail shares bought direct going to stay away personally.
The bulk of local union disputes within RM have been do so with a bullying employee stock option plan under companies act 1956 management culture - when you look at new technology the union has in fact been very good at trying to get agreements that will both protect its members as every good union should and better the service to the public - and in fact the union has often been in alliance with the public and local business alike when the service has been worsened how to determine support and resistance in forex late delivery, new ways of structuring rounds that don't work.
Basic pay for posties is also pretty poor don't forget. But surely the bigger picture here is that like the banks yet again this government seems to be obsessed with nationalising debt in this case the pension defecit but privitising profit - and as a taxpayer I find that both deeply offensive and in terms of the collective wealth and wellbeing of the nation as opposed to a few large shareholdersand stupid in terms of basic government economics in the extreme.
They frequently try and use me as an unpaid postman when they misdeliver post and will not pay me for my efforts. I am sure that, like myself most people find that an increasing proportion of the mail that they receive is advertising of one kind or another.
Now I am sure that the firms involved do not pay anything like the amounts we fork out but, presumably their rates will increase proportionately when the cost of stamps increase. As there citibank euro exchange rate now several effective alternative ways to canvass for business, I can foresee a further substantial mejores brokers de forex 2016 in revenues You just could not run a private business this way!
IMHO Royal Mail should have been privatised years ago.
Royal Mail PLC (RMG) Ordinary GBP Share Price | RMG
I am not a great supporter of privatisations British Rail --Irredeemable, unmitigated disaster but this ragbag outfit is crying out for it. Personally, I don't see Royal Mail as much of an Investment opportunity.
This trend will continue. A raging put option I would think. Come to think of it sell Clinton cards as well. Typical Conservative Government selling off what they can in desperation, whilst still taking punitive measures against its populace. Royal mail can only be saved if it is deregulated to such an extent as to make it competitive, whilst getting rid of some of the staff they already have in favour of someone that knows what they are doing. If this were the case, I would certainly.
I've been a bit of a one-man anti-recession machine recently.
Complete redecoration, savaging the garden, dozens of "got to get round to that" jobs, revamp of the wardrobe, etc.
Most of the stuff I've needed - everything from thermocouple to goldfish - has been ordered online and delivered. Only a handful of the deliveries have come via Royal Mail, and one of those was a "card through the door and leg it" job. Oh, and I can well believe the recently touted story that the UK has the most flourishing internet shopping sector in the world.
Of course, there's probably some personal bias in there, but a builder friend of mine doesn't even own a van anymore. Just takes a cab with his tools and uses Screwfix, Wickes, Jewson, etc to do his loading and driving for him.
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Published in Investing on 27 March A flotation next year is looking the most likely privatisation option. Regulatory relaxation Many investors, however, are put off the idea of buying into a heavily regulated business, and the Royal Mail's universal service obligation could be a pretty big disincentive.
The flotation Although other options, including a sale to a private equity investor, are still on the table, the government is keen for a public offering to both institutional and private investors, coupled with a "Tell Sid" style marketing campaign. Caution is called for Business mail services will surely be the key to future profitability.
If you see Sid, warn him. More from Alan Oscroft: The Retail Recovery Is On The High Street Is Bouncing Back Allegations Of Fraud At Spread-Betting Company. Select an RSS feed to subscribe to: Already invested in UK Mail, good balance sheet, pay dividends and growing nicely.
ANuvver 28 Mar BrnzDrgn 28 Mar1: Having heard what the Royal Mails managers are like I'm staying well away from this.
I received £ of Royal Mail shares, how do I sell them? | This is Money
DCPlug 28 Mar1: GeorgeJHarney 28 Mar5: Coggie 29 Mar3: LateDeveloper 30 Mar1: ANuvver 30 Mar6: Join the conversation Please take note - some tags have changed. Line breaks are converted automatically. Hello stranger To add your own comment, please login. More articles in this section Should you buy these two big fallers today?
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