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Previously the government had indicated they'd sell off their remaining stake in Lloyds to the public i.e. a retail offer, but now Hammonds citing post Brexit market volatility etc as a reason to sell down the stake via a share placement directly into the market. By a "trading plan" he just means a private sale where a lead bank, in this case Morgan Stanley, will take responsibility for placing the shares with financial institutions.
Typically placing larger blocks of shares with institutions does produce a more stable share price reaction. Hammond's argument that it will create the best return for taxpayers is debatable, but usually the type of investors who participate in placements are longer term investors, so are more likely to buy and hold their stakes. Whereas retail investors are generally more fickle and likely to pocket a quicker return, for example following the Royal Mail IPO...
What's a trading plan?