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Free Shares Offer
Eligible employees were guaranteed 10 per cent of shares in Royal Mail, more than in any other UK privatisation for almost 30 years. It is the largest free allocation of shares of any major UK privatisation. Just over 100 million shares were reserved for the Free Shares Offer,
The initial market value of Free Shares for each full-time eligible employee, based on the closing mid-price on 15 October 2013 was £3,545.25. This has exceeded the annual limit of Free Shares that can be allocated to an individual employee, which is £3,000. Eligible full-time employees have therefore been allocated 613 shares, worth £2,997.57 in their 2013 SIP allocation.
Royal Mail intends to allocate the 112 surplus shares to individual full-time employees as soon as possible in the next tax year as a 2014 SIP allocation. Eligible part-time employees will also receive their Free Shares in two allocations.
Eligible employees could receive more, or fewer, surplus shares than the company expects, based on the number of unallocated shares and the number of eligible employees. It is highly likely that eligible colleagues will be allocated at least the number of surplus shares that have been reserved for them in their 2014 allocation.
Overwhelming majority choose Free Shares
Approximately 150,000 eligible Royal Mail employees have chosen to receive Free Shares in the company. Each of the full-time eligible employees has been given the same number of shares, regardless of their grade, with part-time employees given shares on a pro-rata basis based on their paid hours between 10 July 2013 and 13 October 2013.
Eligible employees have been given their shares through an HMRC-approved, tax-advantaged SIP. During this time, employees who have received Free Shares will be eligible to receive any dividends Royal Mail may pay. After three years, employees can sell their Free Shares or transfer them out of the SIP but will pay income tax and National Insurance on the shares. After five years, no income tax or National Insurance needs to be paid on the Free Shares if sold.
(1) Based on the closing mid-price on 15 October 2013
For more information contact:
Phone: 020 7449 8261
Mobile: 07436 267 324
Phone: 020 7449 8241
Mobile: 07435 768 549
Notes to Editors
Free Shares Eligibility
Eligible employees are those who did not opt out of the Free Shares Offer and were employed by Royal Mail Group Limited between 10 July 2013 and 15 October 2013.
The overwhelming majority of Royal Mail Group Limited’s 150,000 employees in the UK, including employees working in Parcelforce Worldwide, are eligible for Free Shares if they meet certain criteria. Employees of GLS and other subsidiaries and joint ventures are not eligible to receive Free Shares.
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