LONDON — Britain’s High Court on Tuesday gave approval for the collapsed rail-infrastructure company Railtrack PLC to be taken over by a new, not-for-profit firm, the Associated Press reports.
A judge ordered the lifting of a year-old order placing the company under the administration of accountants Ernst & Young. The action, to take place on Thursday, means Railtrack will be able to be sold under a government-approved, shareholder-agreed plan.
Judge Sir Francis Ferris said he was satisfied that a government plan to sell the company was sound.
Last October, the government put Railtrack into financial administration, or receivership, and said it would be taken over by government-backed Network Rail.
Railtrack was set up to maintain the country’s network of train tracks when the state railway system was sold off in the early 1990s.
A series of deadly crashes badly discredited the company. Safety problems forced it to spend hundreds of millions of dollars replacing track, work that disrupted travel for months.
Last year, then Transport Secretary Stephen Byers said the company was a financial black hole into which he could not responsibly pour any more taxpayer money.
Network Rail will pay 500 million pounds (dlrs 780 million) for Railtrack — including 300 million (dlrs 470 million) provided by the government. It will also assume Railtrack’s debt of 7.1 billion pounds (dlrs 11.1 billion).
Shareholders — who say Railtrack shares plummet from a high of 17 pounds (US$27) to 280 pence (US$4.40), are expected to receive between 252 and 260 pence (US$3.95 and 4.09) a share.