Words in [single square brackets] included hyperlinks in the original document
Words in [[double square brackets]] are editorial additions or corrections
Words in [[[triple square brackets]]] indicate embedded images or graphics in the original document. (These are not usually archived unless they contain significant additional information.)
Directors of Railtrack Group today met with officials from the Department of Transport, the Environment and Regions (the 'Department') in order to demand restoration of shareholder value.
On behalf of the board the Directors demanded that value for shareholders was protected through:
ITEMS AGREED
o The Government ensuring that Railtrack Group gains immediate access to the £370 million of cash which is being withheld from the company by HSBC. Agreement was secured in principle that £370m would be available to shareholders in cash at the time that the new not for profit company is formed. This equates to some 70 pence per share of value.
o Confirmation that the Government will ensure that Railtrack Group can continue to meet its short term cash requirements whilst the items tabled are under discussion.
ITEMS TABLED BUT OUTSTANDING:
o It is required that the Secretary of State confirm that Railtrack Group remains entitled to the Channel Tunnel Rail Link concession, which has an estimated value to Railtrack Group in the region of £400 million (equivalent to a further 75 pence per share). The Government, will need, for example - to ensure Railtrack retains an ability to securitise future revenue streams and undertake certain other actions to ensure Railtrack Group is able to run this concession, or realise value for it.
o The Government agreeing that it will enter into discussions on fair compensation to shareholders to increase the total value per share to the £ 3.60 demanded. Taking into account dividends paid since privatisation, and the cost of capital, directors believe that £3.60 represents fair return to shareholders from privatisation.
The Company indicated that if Government committed to restore shareholder value to £3.60 per share in total they would waive certain potential claims and be in a position to recommend to shareholders that this be accepted. We understand that the items tabled but outstanding will now be discussed by Ministers.
- ends -
All recent press releases can be found on the Railtrack web site www.railtrack.co.uk
