Short trip on the gravy train nets profit of pounds 12m

Click to follow
The Independent Online
Life's lottery produced a new set of millionaires yesterday when a recently privatised rail company was bought by one of the world's biggest banks yesterday.

Andrew Jukes, managing director of Eversholt Leasing - which rents its 4,100 trains to private train companies - stands to make more than pounds 16m from shares bought for pounds 110,000 a year ago.

The firm, known as a Rosco (rolling stock leasing company) was sold by the Government last year for pounds 580m including pounds 80m of debt to British Rail managers. Forward Trust, a subsidiary of Midland Bank, paid pounds 208m more than the original price yesterday, taking over the company for pounds 726m.

"We took a risk and it paid off," said Mr Jukes, who helped set up Eversholt in 1994.

Private bidders for the train rental companies were scared off when the Government first put the businesses up for sale by the length of the leases, leaving the firms in the hands of the management teams.

"The picture in 1995 was one of pessimism and cynicism about the sale," said Mr Jukes. "We went against the grain and took the risk."

Mr Jukes's risk involved raising a little over than pounds 110,000 - which he did without mortgaging his family home in Surrey.

An engineer by training, Mr Jukes's first job was with Rolls Royce in Derby. He moved to run the bus division for London Transport in 1973 and joined British Rail in 1988 where his ability to spot a good deal made him the perfect choice for BR's investment adviser.

Despite his new-found wealth, Mr Jukes will remain at the company. His finance director, Colin Habgood, will not. His short trip on the gravy train will end in three months' time - leaving the former chartered accountant nearly pounds 12m richer.

The new railways have seen the return of the railway children. The sons and daugthers of two Eversholt directors - Mr Jukes and engineering director Roger Aylward - stand to make pounds 9m from the sale via a special trust arrangement.

Another 58 staff share more than pounds 40m, and executives from the bank which backed the management team will gain home pounds 5m. Other beneficiaries include Wolverhampton council and the New York Metropolitan Museum of Modern Art, which will profit from indirect stakes in the company.

The 15,000 per cent profit margin incensed Labour, which had only just finished making political capital from the last sale of a Rosco, in which Sandy Anderson, a former aircraft leasing expert, made a profit of pounds 33m in seven months from the sale of his company to Stagecoach, the bus and rail giant.

"Today's news confirms that the Government learned nothing and did nothing. I challenge them even now to admit that they got it wrong and short-changed the public by selling cheap these national assets," said Andrew Smith, Labour's transport spokesman. He produced a dossier, The Great Train Robbery, which claimed that the share gains available to the directors of Eversholt, Porterbrook and another train company, GB Railways, topped pounds 103m. And he said he would be writing to the Public Accounts Committee urging an to investigation into how the assets came to be sold off "so cheaply".