Shares in Royal Mail (LSE: RMG) reached the 600p mark for the first time during trading today, making a mockery of the launch price at its initial public offering.
The climb comes after the postal services company and union leaders reached a proposed agreement over “pay, pensions and other issues”, which should avert a strike by postal workers over Christmas.
This landmark means that the price has risen by more than 80% from the original 330p per share investment at launch, while the escalated share price means that Royal Mail now yields closer to 3% for new investors than the 6% that shareholders who bought in at the IPO will receive.
It also means that the price has surpassed expectations set by two banks who warned the government that Royal Mail ought to be valued nearer 500p than 330p, even with the potentially damaging threat of strikes never too far away.
