LONDON, Nov 20 (Reuters) - One of the lead banks on thefloat of Britain's Royal Mail said the government couldnot have sold its stake in the postal firm at the price theshares are trading at now.
On Wednesday bankers, including from UBS andGoldman Sachs which managed the initial public offering(IPO), were summoned before the Business Innovation and Skillscommittee to explain their valuations of Royal Mail.
Richard Cormack, co-head of equity capital markets atGoldman Sachs, said feedback about what investors were willingto pay and the number of shares in the company the market wasbeing offered in one go, affected the price.
"The average (trading) volume at the moment on a daily basisof these shares is about 1.3 million shares versus the 600million shares that we placed at the time of the IPO. I don'tthink that today's price is indicative of where we could haveplaced 600 million shares," he said.
The government sold a 60 percent stake in October for 330pence per share, valuing the company at 3.3 billion pounds. Theshares have risen as much as 80 percent since. On Wednesday, thestock was trading down 1.5 percent at 542 pence.
Citigroup, Deutsche Bank, JP Morgan and Panmure Gordon, none of whom worked on the listing,told the committee that in the months before the float they hadgiven the government valuations that ranged from 3.7 billion toas much as 8.5 billion pounds.
