Five Railtrack directors increased share holdings the day after Paddington crash

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The Independent Online

FIVE DIRECTORS in Railtrack, the company that runs Britain's railway infrastructure, increased their shareholdings in the company the day after the Paddington rail crash.

FIVE DIRECTORS in Railtrack, the company that runs Britain's railway infrastructure, increased their shareholdings in the company the day after the Paddington rail crash.

A Railtrack official denied it was insensitive for executives to be raising their holdings in the immediate aftermath of the accident. A spokesman said yesterday: "This was the reinvestment of dividends paid - you can have it either in cash or shares. It was a decision [on timing] made ages ago at the agm [in July]. It is not within their power to change it."

Since the two-train collision on 5 October, which left at least 30 people dead, the company has been criticised for its allegedly lax attitude towards rail safety, and seen its share price slip. The shares ended 48p lower yesterday at 1,154p. The drop takes their fall since the market close on 4 October to 13 per cent.

A disclosure document filed with the Stock Exchange shows that on 6 October Gerald Corbett, the chief executive, Norman Broadhurst, the finance director, and Christopher Leah, the director of operations, all increased their Railtrack holdings. Mr Corbett added one share, taking his stake to 4,374 shares; Mr Broadhurst added 112, taking his holding to 9,348 shares, and Mr Leah added 32 shares, pushing his stake to 3,925 shares.

Non-executive directors Christopher Jonas and Roderick Muttram also added shares as dividends were re-invested. Mr Jonas added 31 shares, taking his stake to 3,764 shares, and Mr Muttram added 51 shares, taking his holding to 3,439 shares.

The company's shares have fallen steadily since the accident amid fears that Railtrack could be compelled to boost spending on improved safety measures. Analysts said that there was also a psychological impact from the disaster, with some investors shunning stocks connected with rail travel as Government investigations proceed. Railtrack was stripped of its responsibility for rail safety by the Government in the days after the crash.

On Monday Tom Winsor, the rail regulator, said he had asked the Health and Safety Executive to determine whether any of the companies involved in the crash had breached their licenses. It is likely to be several months before the findings are known.

Some brokers are sticking with their assessment of Railtrack. Goldman Sachs, the US bank, issued a fresh report on the company this week, maintaining its "market perform" rating.

It said: "We expect accelerated expenditure on safety, but do not expect this to have an impact on valuation."

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