UK - In a letter to Railtrack, the Financial Services Authority (FSA) has backed the rail infrastructure firm's version of events leading up to its collapse with regard to past speculation about the state of the company's knowledge prior to the entry into administration, and as to whether there could have been inadequate disclosure to the market as to the company's financial position.
In the letter, the FSA said: “As you are aware, the Financial Services Authority in its capacity as the United Kingdom Listing Authority (UKLA) has been conducting preliminary inquiries in relation to this matter.
“The purpose of this letter is to inform the company that the UKLA considers that no further action should be taken in relation to this matter. This confirmation is based on the information and evidence available to the UKLA as at the date of this letter and reflects only the UKLA’s current view that no further action is appropriate. “
On October 8, 2001 the listing of shares in Railtrack was suspended at the company’s request. The suspension was requested as a consequence of the Secretary of State for Transport’s successful petition to appoint an administrator for the subsidiary under the Railways Act 1993.
The UKLA has focused its preliminary inquiry on whether there is a prima facie case of a breach of its Listing Rules relating to disclosure of price sensitive information during the period from May 24, 2001, when the company’s preliminary results for 2000–01 were announced, to October 5, 2001.
The UKLA has gathered evidence both from the company, in the form of a submission, chronology and bundle of relevant documents, and from the Department of Transport, Local Government and the Regions.
The UKLA accepts the company’s submission that at all times until October 5 it was proceeding on the reasonable basis that its negotiations with Government on both the Renewco arrangements and its own Project Rainbow proposals had not been concluded.
* Friends of the Earth today called on Chancellor Gordon Brown to demonstrate the Government’s commitment to public transport with a 75% increase in funding for Britain’s railways, to be paid for by cuts in road-building and a ten-year programme of increases to fuel tax.
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