Was Royal Mail sold too cheaply?
 

http://www.bbc.co.uk/news/business-24488144

Probably it seems. Obviously you want it to go up slightly or stay the same but you don't want it to jump by almost a third.

Re: Was Royal Mail sold too cheaply?
 

The opening price is pretty meaningless. What's more indicative of the 'true value' is what level the price stabilises at in coming months.

I dare say all the RM staff who got shares will be delighted anyway and now they'll have more of an incentive to make 'their' business a success.

Re: Was Royal Mail sold too cheaply?
 

I wish i had bought shares but i never knew about it.

Re: Was Royal Mail sold too cheaply?
 

You ain't missed much mate, I tried for five grands worth and got 749 pounds worth, the maximum any one was allowed incidentally, I don't think it should've been sold of and just like everything else privatised it's been given away :(

Re: Was Royal Mail sold too cheaply?
 

They could have made £2.7billion if they'd sold at a higher price.

---------- Post added at 22:09 ---------- Previous post was at 22:07 ----------

I bet the posties will be selling theirs next week when their share certificates come through. Correction, they've got to wait 3 years before they can cash them in, 5 years if they want to avoid tax.

Re: Was Royal Mail sold too cheaply?
 

Whats happened to the pension debt RM has.. had?

Re: Was Royal Mail sold too cheaply?
 

We the tax payer have taken that on

http://www.bbc.co.uk/news/business-17423461

Re: Was Royal Mail sold too cheaply?
 

so RM now has standing debt of 1.4bn

news.sky.com/story/1140451/royal-mail-secures-1-4bn-debt-deal

hmm.. i reckon some people are getting carried away with their top level pricetag. somewhere inthe middle could have been achieved.

Re: Was Royal Mail sold too cheaply?
 

The inital price will have been based on worth of business. After that the share price will be affected by people treating the shares as a easy way of making money and not a longer term investment. X will buy shares based on what the buyer Y thinks buyer Z will pay for them. This increase the share price. Same thing happens with house prices. People buy a house expecting to make an easy profit in a years time from somebody else who will in turn hope to make an easy profit in another years time.

Re: Was Royal Mail sold too cheaply?
 

You need to wait at least 3 months before you get the beginning of a meaningful answer to that.

Re: Was Royal Mail sold too cheaply?
 

Didn't the Government give up most of it's share in the initial offering? EDIT: No, turns out they didn't. So hopefully the price isn't a fluke and is the worth of the business.
---------- Post added at 23:45 ---------- Previous post was at 23:41 ----------

The share price reflects what the market thinks the company is worth.

When you're doing an IPO you don't want to price it too high so that the offering is undersubscribed but you also don't want to leave money on the table. The share price changing too much from it's initial pricing is not what you want, at least not if you're the one selling those shares.

Re: Was Royal Mail sold too cheaply?
 

70% of the shares weren't available to plebs like us, they we're reserved for the high rollers like pension funds and sovereign wealth funds. The government kept 37.7 percent in tax payer hands iirc

Re: Was Royal Mail sold too cheaply?
 

"High rollers like pension funds" that pay the pensions of ordinary retired people.......

Re: Was Royal Mail sold too cheaply?
 

Yeah, we wouldn't want our pension funds to make money would we. That way we can all retire on a healthy diet of fresh air and blame those evil Tories for that too... :rolleyes:

Re: Was Royal Mail sold too cheaply?
 

Anyone who's ever owned share knows they go up and down for all sorts of reasons and the opening price is rarely an indicator of anything other than demand chasing limited supply. When the demand slows the price will fall and that will have much less to do with the 'value' of the company or its assets.