LONDON (Reuters) - The British government on Wednesday said it would sell half of its remaining stake in Royal Mail (L:RMG), leaving it with about 15 percent of the postal service that was wholly state owned until 2013.
Chancellor George Osborne said last week he would sell the government's holding, which is worth about 1.5 billion pounds, as part of a renewed push in his drive to wipe out the budget deficit.
The shares are likely to be priced at 500 pence each, after a source close to the sale said potential investors have been told orders below that level risk missing out.
The 2013 privatisation of the 500-year-old postal operator attracted criticism from rival politicians and trade unions who said the firm had been sold off too cheaply after the shares quickly rose as much as 87 percent.
The government said on Wednesday current market conditions represented a good opportunity to achieve value for the taxpayer.
In a speech later on Wednesday, Osborne said the government would also award up to 1 percent more of Royal Mail's shares to staff, after giving them 10 percent of the company when it was privatised in 2013.
The shares, trading at 516.5 pence on Wednesday, are close to a one-year high.
BofA Merrill Lynch, Goldman Sachs and J.P. Morgan are acting as book runners for the placing with institutions, and the government said an accelerated book build would begin with immediate effect.
Sources told Reuters that books for the share sale had been covered.
