Electra doubles its valuation of Eversholt stake

Electra Investment Trust said yesterday it had doubled the valuation of its stake in Eversholt, a privatised train leasing company, to pounds 34m, only eight months after the Government sold it.

The unusual decision to revalue so soon after the purchase was prompted by the pounds 825m sale in the summer of Porterbrook, another of the three former British Rail leasing companies.

In the takeover by Stagecoach, Porterbrook was valued at about pounds 225m more than the Government had been paid a few months earlier. The revaluation, the first public disclosure by an Eversholt shareholder, confirms that the leasing companies were sold cheaply.

Analysts said that Electra was being conservative even after the revaluation and that its 21 per cent stake in Eversholt could be worth several times the pounds 34m at which it is now in the books.

The disclosure is also likely to reinforce speculation about the future of both Eversholt and Angel, the two remaining independent train leasing companies. The three leasing firms together own the entire rolling stock of the rail network.

Angel, which is controlled by Nomura, the Japanese securities house, has already disclosed that it is looking for a partner.

But Michael Stoddart, chairman of Electra, which was one of half a dozen venture capital funds that backed the management buyout of Eversholt, said there were no plans to put the stake up for sale.

The valuation does not disclose the split between equity and debt in Electra's holding, so it is not clear what the equity portion is worth. However, Porterbrook was financed mainly by debt so that when it was sold to Stagecoach, the bus operator, the small amount of equity soared in value.

This brought a pounds 65m profit to three directors who took part in the original buyout. Eversholt, which was bought for pounds 585m, is also thought to be highly geared.

Mr Stoddart, who was announcing an 18.5 per cent in Electra's net asset value over the year to September to pounds 886m, also warned that the price of management buyouts in which it specialised had risen sharply, and a lot were being sold by auction.