Railtrack sale gets into its stride

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The campaign to sell Railtrack to the City for up to pounds 2bn got into its stride yesterday with the first full scale meeting between the company and institutional investors.

About 80 specialists from investment management firms were briefed at SBC Warburg's conference centre by Sir George Young, the transport secretary, and Bob Horton, the chairman of Railtrack.

This will be followed today by a seminar to brief share shop specialists. The government said earlier this month it had decided not to set up a full scale share information office along the lines of other larger privatisations and it plans to concentrate private investor marketing through share shops.

At yesterday's meeting Mr Horton was accompanied by John Swift, the rail regulator, Roger Salmon, who runs the Office of Passenger Rail Franchising (and is charged with selling the train operating companies) and Wynn Ellis, head of SBC Warburg's Railtrack analysis team. The investment bank is global co-ordinator to the sale.

Sir George said that 32 rail businesses with turnover of pounds 2bn had been sold so far and 30 companies with turnover of pounds 3bn were on the market. He added: "The responses from the private sector, from major companies and leading financiers around the world have confounded our critics."

Railtrack's advisers believe that most of the building blocks are in place for the sale of the track infrastructure company for pounds 1.5-pounds 2bn, after the cost of performance penalties and the size of the company's share in property profits were clarified last week.

With the interim results also out of the way last week, the sale is scheduled to go ahead in May, less than two months after the end of the financial year in March. The main financial problem remaining is the scale of the debt write-off.