Royal Mail sorted with £400m sale

ROYAL Mail is set to rake in more than £400million by selling land in London for luxury flats.

However, some estimate that the privatised firm will make far more from flogging the former sorting offices in three prime areas.

The sales come as the firm remains locked in a row with unions over plans to shut its defined benefit pension scheme, a move that will hit nearly 90,000 workers.

The latest land deal saw Royal Mail agree to sell 2.7 acres in Battersea, South London, to an American property firm for £101m.

The two plots are among seven on a 14-acre site at Nine Elms, close to the new US Embassy.

The £101m price is eight times more than the £12.9m “book value” Royal Mail had put on the land.

Royal Mail is also believed to be close to selling another large site – part of its Mount Pleasant complex in North London – for a reported £200m. The postal giant previously sold its Paddington sorting office for £111m in 2014.

Yet Royal Mail’s prospectus before its 2013 privatisation put the “book value” of its entire British freehold property estate at £787m.

The privatisation raised nearly £2billion for the UK taxpayer. Royal Mail shares were sold for 330p but rocketed on the first day and have remained above that price ever since.

The then Business Secretary Vince Cable, now leader of the Lib Dems, was criticised at the time.

Unite union’s Brian Scott said: “Royal Mail says it has no money and it is pleading poverty yet it has just sold two plots of land for more than £100m. It remains the case that Royal Mail was sold on the cheap.”

Royal Mail said: “Investors were provided with sufficient disclosure to assess the potential value of the property portfolio in the prospectus.”