10/21/1986: British Airways Public Sale Campaign Announced

Today in 1986, the British government outlined a publicity campaign for the sale of its British Airways (BA) shareholding, ahead of a planned flotation in early 1987.

Transport Secretary John Moore told Parliament that details of the offer and how to apply for shares would be advertised in the press and on television. A share opportunity office had been established to handle inquiries, while senior airline managers would tour the country to promote the sale.

The plans also included preferential share terms for employees and a loyalty bonus for initial purchasers who kept their holdings for three years. Moore proposed one free share for every ten bought, subject to a limit on the initial purchase eligible for the bonus.

The subsequent promotion included Concorde flybys, laser shows and television advertisements, the Los Angeles Times reported in February 1987.

The Share Sale

The government offered 720.2 million shares at 125 pence each, valuing the sale at £900.25m, according to an Associated Press report published in January 1987. Buyers paid 65 pence on application, with the remaining 60 pence due on August 18.

Trading began on February 11, 1987. The House of Commons Library's account of the privatization records demand for the UK public offer at 32 times the shares available. Shares were reallocated from institutional and overseas investors to the public, leaving that offer 23 times subscribed.

The distinction between the sale's headline value and the government's receipts matters: the Library lists net proceeds of £850m. It records no remaining government shareholding after privatization.

British Airways had begun operations under its combined identity in 1974. Its privatization transferred an established airline from state to private ownership in a market where it already faced competition, as the Commons Library explains.