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| Royal Mail shares 'seven times over-subscribed' | Royal Mail shares 'seven times over-subscribed' |
| (about 1 hour later) | |
| The Royal Mail share-offering for private investors was seven times over-subscribed, with 700,000 applications in total, according to the Business Secretary Vince Cable. | The Royal Mail share-offering for private investors was seven times over-subscribed, with 700,000 applications in total, according to the Business Secretary Vince Cable. |
| Speaking to a committee in parliament, he said he was "confident" the shares were "priced in the right place". | Speaking to a committee in parliament, he said he was "confident" the shares were "priced in the right place". |
| Shares will begin full trading on Friday, priced between 300p and 330p. | Shares will begin full trading on Friday, priced between 300p and 330p. |
| Mr Cable's comments come after criticism from Labour that the shares were being sold too cheaply. | Mr Cable's comments come after criticism from Labour that the shares were being sold too cheaply. |
| Strong demand | |
| The deadline for the general public to buy shares was on Tuesday. | The deadline for the general public to buy shares was on Tuesday. |
| Shares were initially priced between 260p and 330p, but strong demand led the government to revise the figures up on Friday last week. | |
| 30% of the shares on offer Royal Mail was offered up to private investors, with the rest being sold to institutional investors such as pension funds and insurance companies. | 30% of the shares on offer Royal Mail was offered up to private investors, with the rest being sold to institutional investors such as pension funds and insurance companies. |
| The offering for institutional investors were also heavily subscribed, he said. | The offering for institutional investors were also heavily subscribed, he said. |
| Under the terms of the share sale, a 10% stake in the business has been reserved for Royal Mail employees. | Under the terms of the share sale, a 10% stake in the business has been reserved for Royal Mail employees. |
| The sale is expected to value the firm at £3.3bn, at the top of the target range. | The sale is expected to value the firm at £3.3bn, at the top of the target range. |
| Mr Cable was asked by MPs how he would protect the company from retail investors selling quickly for short-term profit. | Mr Cable was asked by MPs how he would protect the company from retail investors selling quickly for short-term profit. |
| He said: "Obviously we can't account for how the retail investors use the shares when they have acquired them." | |
| He said the government was "committed to protecting that particular group", adding small, private investors were probably not looking to "make a killing". | He said the government was "committed to protecting that particular group", adding small, private investors were probably not looking to "make a killing". |
| He added that he was "absolutely confident" that shares would be placed with long-term investors, as the government was not just looking for the highest bid, which would encourage short-term investors such as hedge funds. | He added that he was "absolutely confident" that shares would be placed with long-term investors, as the government was not just looking for the highest bid, which would encourage short-term investors such as hedge funds. |