If you were lucky enough to have bought shares in Royal Mail yesterday, you could have made an instant 35% profit this morning. The Government sold the shares at 330 pence each, claiming that people who said that price seriously undervalued the company were “way out”.
The market apparently disagreed- the shares rapidly soared to 459p. From the Guardian:
The 690,000 people who managed to buy £750 of Royal Mail shares have made an instant paper profit of more than £250 after the shares soared by 35% when they started trading on Friday.
Royal Mail shares, which the government sold at 330p, started trading at 450p on Friday morning and peaked as high as 459p before settling at 445p at 9am.
The steep share price rise will heighten accusations that the government “massively shortchanged” taxpayers by significantly undervaluing the 500-year-old national institution.
Royal Mail’s market value has risen by more than £1.1bn to £4.5bn. The government valued the company at a maximum £3.3bn, and attacked analysts who valued Royal Mail at £4.5bn as “way out”.
If the government had sold the shares at 450p, rather than 330p, it would have made an extra £700m for the taxpayer on top of the £2bn it made from the 60% stake in Royal Mail.