Network Rail plans assets sale to pay debts
Network Rail has asked Big 4 firm KPMG to look into the viability of selling off electricity assets in order to tackle the state-backed group's mounting debts.
The organisation, which was set up to look after the nation's Victorian-era railways infrastructure, could make as much as £2bn from a sale of assets.
Network Rail is responsible for repairing and maintaining the UK's 20,000 miles of railway track as well as 40,000 tunnels and bridges and 6,300 level crossings.
However, Government ministers are concerned that the organisation's additional responsibilities surrounding running its property portfolio and large electricity distribution network are causing problems, as Network Rail is the UK’s biggest energy customer.
Network Rail's property estate includes retail units in railway stations and depots that could raise around £1.8bn if sold. Other assets such as overhead pylons could be worth even more, according to some sources.
Now KPMG has been brought in to come up with ideas on how an asset sell off could be structured. One possibility is that Network Rail’s power distribution network could be sold to a private investor, an energy utility company or even the National Grid.
A company spokesman for Network Rail said: “We have commissioned a six-month review to evaluate options on how we can engage private sector capital and expertise to further improve the management of our electrical power assets."
“The review will be complete by the spring of 2016,” the spokesman added.