Shares to be priced between 260p and 330p in listing on 11 October – 12 days before earliest legal strike date

The government is racing to push through the £3.3bn privatisation of Royal Mail before postmen and women have the chance to walkout on strike against the "great British flog off".

Vince Cable, the business secretary, on Friday announced the coalition will sell up to 70% of the 497-year-old postal service on the stock market on 11 October.

The announcement comes on the day that more than 100,000 postal workers begin voting on whether to take days of paralysing strike action. But the result of the ballot will not be known until 16 October with the earliest legal strike date not until 23 October.

Billy Hayes, general secretary of the Communication Workers Union (CWU), which represents 115,000 Royal Mail staff, said: "The government continues to press ahead with the sale of the UK postal service despite consistent opposition from the public.

"It seems remarkable that the prospectus [for the share sale] is being issued on the same day that postal workers are being sent ballot papers for strike action. Today's announcement changes nothing in terms of the ballot which will go ahead as notified.

"Postal workers and the CWU will continue to fight to save services as well as defend their terms and conditions."

Formally kicking off the sale, Cable said the government will sell the shares at between 260p and 330p, valuing the business at £2.6bn-£3.3bn. The sale could swell Treasury coffers by more than £2bn.

Cable said he had been "encouraged by the interest shown by potential investors so far", which is why the government has increased the amount of shares it may sell from at least 50% to up to 70%.

"Today is an important day in the life of Royal Mail: people can now apply to buy shares in this iconic British brand," Cable said. "The sale of government shares will give others a chance to have a real stake in this important company and we are encouraged by the shown by potential investors so far."

Cable hopes the public will buy about 30% of the shares on offer.

Members of the public will be able to apply for a minimum of £750 worth of stock online, at the Post Office or through brokers until 8 October. The shares will pay a 7.7% dividend before April.

Royal Mail's 150,000 employees will collect 10% of the shares – worth about £2,000 each – for free as part of the flotation. Staff will also share a further £13.3m – about £90 each – in dividend payments in the first year, and more in following years.

Staff will also have preferential access to more shares if they spend at least £500.

It is the most ambitious sale of a state-owned business since the railways were privatised under John Major in the 1990s. Successive governments have tried and failed to sell Royal Mail over the past 20 decades.

Margaret Thatcher, who privatised British Gas, British Airways, British Telecom and dozens of other state-owned institutions in the 1980s, refused to countenance a sale of Royal Mail, saying she was "not prepared to have the Queen's head privatised". Lord Heseltine and Lord Mandelson both subsequently tried but failed to sell the company, in the face of intense opposition from MPs. The sale was approved by parliament in the 2011 Postal Services Act.

Hayes said 96% of Royal Mail staff opposed the sell-off, which "not even Thatcher dared do", despite the offer of free shares.

He said postmen and women will not stand by and watch "people in the City and the board make a killing" from a privatisation that threatens frontline workers' pay and conditions. He added: "This isn't about what's best for the Royal Mail, it's about vested interests of government ministers' mates in the City."

Bankers, lawyers, accountants and PR firms are set to collect up to £20m in fees from advising on the sale.

Labour party members this week voted unanimously for Ed Miliband to renationalise Royal Mail if the party wins power at the next election. But shadow ministers have made it clear that they have no plans to buy back the postal service and the leadership is prepared to ignore the motion in its election manifesto.

Moya Greene, chief executive of Royal Mail, said: "Royal Mail has a unique place in the UK and that will not change as we move into the private sector. We will now be better able to compete in what is a fast changing and intensely competitive market."

Following the sale, Royal Mail could fall into foreign hands because the government is unable to hold a "golden share" preventing an overseas takeover.