Royal Mail's partial stake sale on hold

The British government is reportedly putting on hold plans to sell part of state-owned Royal Mail, citing the depressed state of financial markets and the lack of parliamentary debate time.

Buyout house CVC Capital Partners was reportedly the preferred bidder for the stake, having offered $3.3bn for a 30% holding in the postal company. CVC intended to inject a large amount of capital into modernising the company's technology and infrastructure.

The government had promised it would take on Royal Mail's pension deficit as part of the partial privatisation, which is said to be worth about $15bn.

But legislation to allow the sale ran into opposition from Labour Party backbenchers, as many are against partly privatising a key public service.

It has also been reported that, though CVC's bid is higher than the rival offer from Dutch mail group TNT, it is still lower than the UK government's $5bn target.

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