On privatization practices in UK and Asia

Sir, Today's shareholders and equity article is highly pertinent in relation to Asia. However, I take issue on UK privatisation . My recollection of the leading issue, BT's privatization, was that preference for small investors took the form of allocations only, not price.

Any allocation process is open to charges of discrimination but I think the seller, in conjunction with the company, does have the right to allocate shares with some resultant shareholders structure in mind. I think that is less manipulative than playing with the price, which I believe all the examples you cited exhibit.

However, one could argue the UK sold BT too cheaply too, so in conjunction with allocation policy that amounted to a subsidy for retail. But I believe its a harder case to make and therefore not directly comparable.


Ian Roberts

WI Carr, Taiwan.

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