The British government said Thursday it will raise 1.72 billion pounds ($2.75 billion) from its controversial sale of a majority stake in Royal Mail, putting the system under private control for the first time in its 500-year history.

Demand from small investors forced the government to cut the number of shares sold to large institutions. About 95 percent of all members of the public who have applied — or over 690,000 people — are receiving shares.

The shares will be sold for 330 pence each — the top end of the price range the government had set for the sale. The shares begin trading openly next week on the London Stock Exchange.

The total value of the company is put at 3.3 billion pounds.

"We have struck the right balance, increasing the proportion of shares going to small investors to ensure they get their fair share and ensuring the employees get a 10 percent stake in the business," Business Secretary Vince Cable said.

The sale of a service which traces its history to King Henry VIII has been controversial. The opposition Labour Party has charged that the government undervalued the company, and that taxpayers will be shortchanged.

Labour's Chuka Umunna tweeted that the huge demand for the shares "only serves to support claims it has been under priced."

"Increasingly the Royal Mail sale is looking like a botched job by an out of touch government pressing on despite huge public opposition," he said.

The government says the stock sale will allow the Royal Mail to tap investment that it needs to modernize and to compete in areas such as parcel delivery.