The Business, Innovation and Skills (BIS) select committee accuse the government and its advisers (Lazard, Goldman Sachs and UBS) of botching the £3.3BN Royal Mail sale, and losing the taxpayer £1BN in potential profits.
Pricing a share issue is not an exact science, if the price is too high then all of the shares may not be sold (hence the need for underwriting) if the shares are sold too cheaply then there are accusations that a greater profit could have been made.
In this case a loss of £1BN on a sale of £3.3BN is materially significant. Also, worthy of note, is the fact that (as per the Telegraph) the asset management arm of Lazard (also a specially selected investor in the float) made £8M profit by selling off its stake immediately.
The Government sold 60% of Royal Mail at 330p in October. The shares soared by 38% on the first day of trading and rose as high as 615p but have since fallen back. Yesterday the shares closed at 474p.