Ashursts moves in on Railtrack Group after Simmons conflicted

Ashursts partner Chris Ashworth is advising Rail-track Group on the sale of Railtrack plc's shares to Network Rail for £500m, with a repayment of indebtedness of £350m, resulting in a cash payment of £850m. The deal will see tracks, bridges, signalling and some stations sold to Network Rail.
Ashursts began to advise Railtrack Group in October 2001, once Railtrack plc was put into administration. Railtrack's longstanding adviser Simmons & Simmons decided not to act for both Railtrack plc and Railtrack Group because of potential conflicts. "We were brought in to advise Railtrack Group particularly on matters concerning Railtrack plc," said Ashworth.
Linklaters also gets a major slice of the cake, acting for Network Rail. Corporate partner Philip Heyes is leading the acquisition of Railtrack plc. Partner Anne Hoe is acting for Network Rail on the arrangement with the Strategic Rail Authority, which is financing the acquisition in part with a grant of £300m.
Newtork Rail is also raising £9bn to fund the acquisition and provide working capital. A consortium of banks led by Barclays and UBS Warburg are involved, advised by Allen & Overy's Brian Harrison. The finance team at Linklaters is headed by banking partner Sushma Jobanputra. Heyes said: "The £9bn will be used to pay off Railtrack's £7bn debt, to fund the remaining £200m of shares in Railtrack plc, and the rest will be used for working capital."
Simmons has managed to retain some work for Railtrack Group. It is advising the group on the sale of the first phase of the Railtrack-owned Channel Tunnel high-speed rail link to London & Continental Railways (LCR) for £375m. Simmons is able to ring-fence this transaction as there is limited involvement with Railtrack plc. Herbert Smith is acting for LCR, led by partner Andrew Preece.
LCR has agreed to purchase Railtrack UK Limited, the subsidiary of Railtrack Group that owns and operates the rail link.
Herbert Smith is also dealing with a subsidiary aspect to the negotiations, which involves an £80m agreement with Network Rail to buy the contract rights to operate and maintain the link once it has been built. David Weber is leading the team at Linklaters for Network Rail.
Herbert Smith finance partner Jane Borrows is also advising on the issue of £1.1bn of bonds that are due in 2051 and guaranteed by the Government. The proceeds of this are to be used to part-finance the construction of the rail link. CMS Cameron Mckenna is advising the Government.
Contracts on the transactions were exchanged on 27 June, and completion is subject to various conditions, including the approval of Railtrack Group's shareholders and approval from the European Commission for any for the discharge of the administrative order.