Thursday, June 15, 2017

Singapore buys 4pc of Royal Mail

Singapore buys 4pc of Royal Mail

Singapore's sovereign wealth fund has emerged as the second biggest private investor in Royal Mail with a 4.1pc stake.

Nearly 700,000 small investors were each given 227 shares under the privatisation, valued at £749.10.
Nearly 700,000 small investors were each given 227 shares under the privatisation, valued at £749.10.  Photo: ALAMY
GIC Private, which was formerly known as the Government of Singapore Investment Corporation, has amassed 41m shares in the newly privatised delivery company.
A regulatory announcement shows GIC bought more shares yesterday that took its stake over the 4pc disclosure threshold. Royal Mail’s shares climbed 4.9pc on Friday to close at another high of 555p, despite the threat of strike action by postal workers. At this level, GIC’s stake is worth £227.6m.
The sovereign wealth fund has is already a big investor in the UK with stakes in the Blue Water Shopping Centre and Kelda Group, the water and waste management group.
GIC is the second investor to build a disclosable stake in Royal Mail afterthe Children’s Investment Trust (TCI) revealed a 5.8pc position on Tuesday. The hedge fund, which is run by the activist Chris Hohn, remains the biggest investor in Royal Mail after the Government.
Although GIC is not one of the British pension fund investors that Vince Cable wanted to see at the top of Royal Mail’s share register, it does at least count as one of the targeted “long term” investors.
The Business Secretary has denied undervaluing Royal Mail even though its shares continue to rise. On Friday Gert Zonneveld, the analyst from Panmure Gordon that said Royal Mail was undervalued by a £1bn before the float, published a note saying the company could be worth £5.3bn.
Royal Mail shares were offered at 330p when they listed three weeks ago, valuing the company at £3.3bn.

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