During a stormy Prime Minister's Questions, Ed Miliband claimed David Cameron's government had orchestrated a "sweetheart deal" with City investors, but the PM accused the Labour leader of harking back to the anti-privatisation days of Michael Foot and Neil Kinnock, insisting the sale had been a "success for our country".
Yet within an hour the Business Department succumbed to mounting pressure and published the names of the so-called 16 "pilot fishing investors", with Business Secretary Vince Cable confirming they included hedge funds and overseas sovereign wealth funds.
They were: the Abu Dhabi Investment Authority; BlackRock; Capital Research; Fidelity Worldwide; GIC, Henderson; JP Morgan; Kuwait Investment Office; Lansdowne Partners; Lazard Asset Management; Och Ziff; Schroders; Soros; Standard Life; Third Point; and Threadneedle.
Earlier this year, Royal Mail shares reached 618p. Yesterday, they were trading at 529p, 60% above the offer price.
William Bain, the Glasgow MP, demanded to know which investors had profited from the "knock-down" sale and by how much.
He asked: "What contacts took place between ministers and these investors prior to their expression of interest in buying shares? How can the public have confidence in this cut-price sell-off, where one of the biggest beneficiaries was Fidelity Worldwide, whose investment arm have donated nearly £1m to the Conservative Party?"
His Scottish Labour colleague, John Robertson, was also incensed, tweeting how Mr Cameron had been exposed by the Labour leadership in "helping his friends make millions off the back of British taxpayers".
In the Commons exchanges, Mr Miliband said the privileged investors were given a "golden ticket" to buy Royal Mail shares and then sold them on day one of privatisation, making a "fast buck". "The reason this matters," declared the Labour leader, "is because the sale was grossly undervalued; shares sold for £1.7bn at privatisation are now worth £2.7bn. And who cashed in? Twelve of the 16 so-called long-term investors made a killing worth hundreds of millions of pounds within weeks."
He added: "The more we know about this privatisation, the bigger the fiasco it is. A national asset sold at a knock-down price; a sweetheart deal for the City and the Government totally bungled the sale. Everything about this privatisation stinks."
But Mr Cameron defended the sale. In response to questions over what assurances investors had given in return for their shares, he insisted there was "no agreement". The PM told MPs: "What we are talking about is an exercise in privatising the Royal Mail, which has been a success for our country.
"A business that lost £1bn under Labour has now paid money back to the taxpayer, is making profits and the people we should be praising are the 140,000 employees of Royal Mail who are now under this Government shareholders in the business they work for."
During 2012 and 2013, 65 global investment funds were approached to gauge their interest in buying Royal Mail shares at flotation. The 21 who showed the strongest support were approached in a "pilot fishing" exercise with 16 allocated shares.