Railtrack shareholders to sue Darling

Published on Monday 13 January 2003 00:00

TRANSPORT Secretary Alistair Darling is to be sued by angry Railtrack shareholders who claimed they were cheated out of £1 billion by his predecessor Stephen Byers.

The 50,000 small shareholders, who have raised a 2 million fighting fund, hope to probe the timetable and reasoning for the renationalisation of the company in the High Court.

They want to question Mr Byers and senior civil servants in open court.

They claim Tyneside North MP Mr Byers abused his position as a minister and that the government breached their right by reducing the value of their shares.

This week investors are due to receive about 2.50 for each Railtrack share but they claim they would be worth up to 5 if Mr Byers had not placed Railtrack in administration in October 2001.

The difference in value of the 550 million shares in the former company amounts to 1bn - the possible cost to taxpayers.

The shareholders lawyers are particularly interested in a conversation Mr Byers had with Paddington rail crash victim Pam Warren in September 2001.

She said he told her he was going to wind up Railtrack but he claimed later to MPs and the City he made no decision to place Railtrack into administration until a month late.

Leader of the small shareholders Andrew Chalklen said: "There is a massive feeling among shareholders that they were cheated.

"The Government denies it was going to renationalise the rail industry but that is what they have done through the back door."

Tory Shadow Transport Secretary Tim Collins said: "Everybody knows that Stephen Byers and the government badly botched Railtrrack. But it would be outrageous if, thanks to their incompetence, taxpayers now have to shell out 1bn which should have been spent on a better rail system."