The Railway Preservation Revolution by Brown Jonathan;

Author:Brown, Jonathan; [Brown, Jonathan;]
Language: eng
Format: epub
Publisher: Pen & Sword Books
Published: 2017-12-15T00:00:00+00:00

In the 1970s offering shares in the railway operating companies to the public became a popular means of raising large sums for capital projects, such as extending the line, building sheds and repairing viaducts. The North Norfolk Railway Company was the first to do this, issuing a prospectus in November 1969: £16,000 of shares were offered, with the aim of raising £11,700 of that by 31 December. Ambition was exceeded, with 14,000 shares sold by the end of the year. The Llanberis Lake Railway soon followed suit, with plans for a public offer of shares alongside the conventional public appeal for funds.238 The modest ambitions of the North Norfolk were surpassed by subsequent public share offerings. The Severn Valley Railway offered 150,000 shares at £1 each, which raised £56,000 within a few weeks in 1972.239 The Bala Lake Railway Company sold shares through the press in its locality.240 A share issue was a major means of capitalising the Great Central Railway in its early years, £150,000 being raised from its initial issue. Early successes brought some railways back for more. The North Norfolk Railway made another successful offer of shares in 1975, quickly raising £27,000 out of the total of £30,000 of shares. The Severn Valley made a rights issue in 1976 to raise an additional £110,000 to finance covered accommodation for rolling stock.241

In contrast, the Winchester & Alton Railway’s share issue was an embarrassing failure. It was hugely ambitious, offering 999,993 shares of £1, and with a full-page advertisement in The Daily Telegraph to promote it. The failure to attract more than a tenth of that sum in the required time prompted the Railway Magazine to write that this sent ‘a clear warning to all railway preservation enterprises … that the climate has changed completely since the boom days when share issues were heavily oversubscribed’.242 It certainly did: public share offerings became much less popular, but did not disappear by any means. Peak Rail sold shares in 1988. The South Devon Railway made a successful issue of shares to raise the capital to buy the freehold of its line, and in 2008 the Bluebell Railway launched an offer of 1,800,000 shares at £1 to help finance the extension to East Grinstead. Despite the shortfalls from some share issues, this has successfully raised money for capital projects. An alternative to shares sometimes adopted was a public issue of bonds, such as the £175,000 of bearer bonds sold by the Kent & East Sussex Railway in 1987.243

Sales of shares have largely appealed to altruism: many shareholders effectively treated their purchase as a donation to the railway. There is a very limited market for the sale of heritage railway shares – and other types of social enterprise. None of the companies are publicly quoted, although a few brokers will arrange a market. Only the very few commercial enterprises among heritage railways offered any prospect of a dividend, and shares in those companies were rarely placed on public sale. For the rest, a

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