#AceFinanceNews – BRITAIN – April 02 – Press TV – British Prime Minister David Cameron has come under pressure over the sell-off of Royal Mail, with critics accusing him of selling the firm’s stakes at a knock-down price.
On Wednesday, Cameron was questioned in the House of Commons over the handling of the sale of a 60-percent stake of the mail operator.
Ed Miliband, the opposition Labour party leader, criticized Cameron of selling the shares at an undervalued price.
“He sold at 330 pence and this morning the price was 563 pence. It is basic maths,” said Miliband, labelling Cameron the “Dunce of Downing Street.”
According to the Labour leader, the undervaluation of the 500-year-old state postal operator has cost British taxpayers £1.4 billion.
Miliband continued by saying, “A third of the shares were sold to just 16 city investors and there was a gentleman’s agreement that those city investors wouldn’t sell the shares.”
“What happened? Within weeks, half of those shares had been sold and they had made a killing worth hundreds of millions of pounds. In other words ‘mates rates’ for his (Cameron) friends in the City,” said Miliband.
Cameron responded by dismissing Miliband’s accusations with false claims that the Labour party had called for privatization of the mail operator.
This comes as Britain’s National Audit Office (NAO) released a report on April 1, criticizing the sale. The NAO said the government pressed ahead with plans to privatize Royal Mail at a price of 330 pence a share even though there had been warnings that it was undervalued.
Prior to the sell-off, banks had estimated that the government could receive up to 867 pence per share.
Press TV – CAH/AB – (Additional reporting by Belinda Goldsmith and Chris Vellacott; Editing by Jane Merriman and Pravin Char)
Ace News Services – SELL-OUT – April 02 – That Standard Life Investments said on Tuesday it had cut its stake in Royal Mail from close to 12 million shares held after it was privatised to around 118.480 shares in March.
The NAO also said the government should not have followed the advice of its financial advisers to sell the full 60 percent of shares available for sale.
It could have retained 110 million more shares worth 363 million pounds ($604 million) at the offer price, while still achieving its objective of reducing its ownership to below 50 percent, allowing it to sell another tranche for more later on.
The watchdog questioned the incentive given to the government’s independent corporate finance adviser Lazard , which was to secure a sale and was not dependent on the value achieved.
In a response, Business Secretary Cable said a sale at any cost had never been the aim.
Reports – Stated that Standard Life sold off their shares and made millions in March, meanwhile under the rules of sale the Royal Mail Postal Workers cannot sell for 3 years.