Railtrack heads for pounds 900m write-off
Wednesday 28 February 1996
Ministers are close to reaching agreement with the Railtrack board over a debt level of about pounds 600m. Since Railtrack has existing debts of pounds 1.5bn, this will mean a write-off of about pounds 900m for the Government. Provisional debts of pounds 600m have been pencilled in for the flotation, a level which Railtrack appears relatively happy with.
Negotiations over the debt level have been prolonged and sometimes heated, with Railtrack arguing that it would be incapable of investing adequately if it is saddled with too much. The talks sometimes involved a degree of brinkmanship by the Railtrack chairman, Robert Horton, though he stopped short of threatened resignation.
The outcome is a compromise - Railtrack would have liked less - but most observers thought it a good result for the company ahead of privatisation.
The Treasury appears to have eased its hard line - it wanted up to pounds 1bn of debt in the balance sheet - after ministers decided to give the go- ahead to the Thameslink 2000 project, an upgrade of the track linking north and south London.The go-ahead for the project was formally announced by the Government yesterday.
Agreement on debt removes one of the last obstacles to Railtrack's flotation, scheduled to take place in May. The company is expected to be valued at about pounds 2bn, and with debt now secure at a manageable level, holds out the prospect of a steadily rising dividend stream.
- 1 Autistic adults could take pure MDMA to 'reduce social anxiety'
- 2 Before you complain about your GP, this is what you need to know about actually doing the job
- 3 Father of 12 accused of raping, beating, starving and abusing his own children in US 'cult'
- 4 Britain's Got Talent 2015: Jamie Raven divides Twitter as fans expose mind-boggling magic trick
- 5 Charlie Charlie Challenge explained: not a Mexican demon being summoned — it's gravity
EU referendum: David Cameron's rules are a 'democratic disgrace', says French-born Scottish politician set to be denied a vote
SNP fury as HS2 finds 'no business case' for taking fast train service to Scotland
Australian man punched in the face for defending Muslim women from abuse on train
A nation of inequality: How the UK is failing to feed its most vulnerable people
David Starkey 'tells Amal Clooney to shut up and stop over-promoting human rights'
EU referendum: David Cameron to deny EU migrants and under-18s the chance to vote
iJobs Money & Business
£30 - 35k: Guru Careers: We are seeking a Pricing Analyst to join a leading e-...
£20000 - £25000 per annum + OTE £45K YR1: SThree: At SThree, we like to be dif...
£20000 - £25000 per annum + competitive: SThree: Did you know? SThree is a mul...
£55 - 65k (DOE): Guru Careers: A unique opportunity for a permanent C# Develop...