Top QC to tackle Byers on Railtrack

Railtrack's former directors are to pile fresh pressure on Stephen Byers by conducting their own valuation of the company to prove that the decision to put it into administration was politically motivated.

Steve Marshall, who resigned from Railtrack plc's board in October, is close to appointing an accountancy firm to do the work.

Now chief executive of Railtrack Group, which is not in administration, Mr Marshall said that if the valuation showed that the Government had downplayed Railtrack plc's value, he would launch new legal action against the Transport Secretary.

The news will put the heat on administrator Alan Bloom of Ernst & Young. He reports to Mr Byers but has legal responsibility to maximise the value of Railtrack plc.

Described by one insider as a "litigation vehicle", Railtrack Group has also hired Elizabeth Gloster QC for a legal assault against Mr Byers.

Ms Gloster is rated as one of the country's top barristers. She will work alongside law firm Lovells and the Railtrack Shareholders' Action Group to recover funds for investors.

Ms Gloster has previously worked for the Department of Trade and Industry over the disqualification of the directors of merchant bank Barings and is described by one associate as "a very tough operator".

Mr Marshall said: "It is absolutely key to have a top-draw legal team on the case. We would pursue new legal action if it showed that the value attached to plc was less than our own assessment."

Optimistic estimates value Railtrack plc at £1bn. Privately, Railtrack Group is worried that the Government's own valuation could become mired in politics as a low value would help to back Mr Byers' decision to put the company into administration.

Mr Marshall is also pursuing Mr Byers for release of documents surrounding the decision to put Railtrack into administration. Legal proceedings could start next month.

The list of firms available to value Railtrack plc could be limited. One senior accounting source said: "Whoever takes this on will be, in effect, taking on Whitehall. This could leave the firm persona non grata with Her Majesty's Government."

Mr Marshall also dismissed Mr Bloom's claims that Railtrack plc would be out of administration by September.

Railtrack plc is likely to apply to rail regulator Tom Winsor for an extra £3bn of funding as part of an "interim review".

But Mr Marshall said that this process could drag on until 2004, if Mr Winsor "is true to his form".

A spokesman for Mr Bloom said: "The administration process may not be completed by the date first indicated."

This casts doubt over Mr Bloom's plan to garner bids for Railtrack plc in March. As well as a Government-backed Company Limited by Guarantee proposal, German bank WestLB has also expressed an interest. But sources said that possible buyers would not be able to put a price on their bids until the interim review was completed.