Shares in the company which have slumped from over 900p at the start of the

Shares in the company, which have slumped from over 900p at the start of the year, fell another 72.5p yesterday to 327.5p, a five- year low. Peter Harrisson, chief executive, said that previously strong demand from China, where Molins supplies rolling machines to the huge state tobacco industry, had showed no sign of resuming and orders previously in the bag continued to be delayed. We tend to look inwards and upwards, not outwards.”He was speaking as Railtrack announced a 10 per cent rise in pre-tax profits in the first half of the year to pounds 190m, an 8 per cent increase in the dividend and a 38 per cent increase in investment to pounds 520m.Costs involved in the redundancy programme and tackling the millennium computer timebomb were pounds 18m in the fist six months and Mr Corbett said he expected the Year 2000 date change to cost it pounds 30m-pounds 40m in total.After the harsh criticism meted out in the past by the regulator and the Government over its investment performance, Railtrack said spending would be on target by the turn of the year.Investment on station improvements would reach pounds 150m by the end of the year while spending on track renewal was now well ahead of the programme agreed with the regulator.In contrast to his caustic comments at the time of Railtrack’s final results announcement last summer, Mr Swift was almost praiseworthy of the company’s performance, saying that its interim results showed improvements were under way.Mr Corbett cast doubt on whether Railtrack would take part in the high- speed Channel Tunnel Rail Link, saying it was cautious about the project, which is expected to cost pounds 3.5bn-pounds 4bn before financing costs.. Sir Bob said Railtrack could not expect to demand efficiency improvements from its suppliers such as the infrastructure and track renewal companies, it did not tackle its own over-bureaucratic structure.The changes were also vital if Railtrack were to meet its pounds 10bn investment programme in the rail network and respond to the challenge set down by the Rail Regulator, John Swift.Gerald Corbett, Railtrack’s new chief executive, said: “Future challenges placed on us by the growth in the network, the demands of our customers, the demands of other stakeholders and the scale of our investment programme are such that as currently configured, we would be unable to cope.”We have to increase the responsiveness of our organisation and push decision making downwards and outwards to where the customers are The organisation is too rigid, too hierarchical. The cutbacks are the equivalent to 10 per cent of Railtrack’s 10,600- strong workforce and will see whole layers of management abolished. So far this year 300 jobs have disappeared, many of them managerial posts, and the target is to reduce manning at a rate of 500 a year.
Two entire layers of management have already been stripped out of Railtrack’s property division and its engineering and production division as part of the restructuring, which goes by the name of the C-Change programme.

“Bankers’ Trust is now going after NatWest.”And so, the conference drew to a close, and a great British name in investment banking disappeared into the history books.. Railtrack is to sweep away 1,000 jobs over the next two years, many of them in management positions, after concluding that its present organisational structure is unable to cope with the demands on the rail network. Michael Harrison examines how Sir Bob Horton, chairman, is getting to grips with the bureaucracy inherited from the old BR. For instance, BZW’s research team will increase the number of UK companies covered by the bank by more than 400, he said.Mr Wheat then said that the original figure had been put down as nearly 450 companies, but he had not wanted to admit how few companies CSFB already covered in London – to a barrage of laughter from his fellow directors.

He added: “The net cost to us [of the acquisition] will be pounds 175m.We’re taking about 800 front office people,” he said, while the number of information technology and back office people to be kept on was under negotiation CSFB wants to take “obviously as few as possible,” he added. “We will probably take on a few hundred.”Mr Wheat said that at a recent internal conference in Miami, the bank’s top brass had pondered the need to expand beyond its core strengths, fixed income and derivatives, as well as the need to bolster its activities in Europe and the UK, where “we kinda lack critical mass”.BZW will almost perfectly complement some of these weak areas, he said. It will involve a charge from earnings of pounds 100m after tax, which will be taken as an extraordinary charge, “so the P&L dosesn’t suffer, and savings flow directly to the bottom line”. “No goodwill [was paid for] in this transaction,” the director said. He added: “We will keep [BZW's] space in the Barclays building — we will rent space from then on fairly cheap terms.”The integration of the two banks will be “very complex”, said the director. Specifically, Mr Wheat said, BZW’s Japan business was “a loser”.”We haven’t anyone to send there.” Then to raucous laughter from his fellow directors, Mr Wheat added: “I don’t know anyone I dislike enough to send there.” He concluded: “We chickened out on that.”Back in London, a UK-based director said that for the pounds 100m paid to Barclays, CSFB is getting pounds 150m net assets, while the staff retention plan will cost pounds 50m. Mr Wheat explained that the Asian operations were for the most part start-ups which were not profitable, that there were too many locations to cover Asia was “too big a bite for us”.

“Every top manager has signed as well as 200 top people,” the UK director said. The “staff retention plan” operated by CSFB offered them 3 years vesting stock in CSFB as the carrott, and the stick was represented by lengthy non-competition clauses.Allan Wheat, chief operating officer of CSFB, chimed in from New York, answering another director’s question as to why the bank had not bought the Asian and Australian bits of BZW, as it had originally offered to do. `The Independent’ was yesterday able to listen in to a highly confidential global video conference held for Credit Suisse First Boston’s managing directors in London, New York and Hong Kong to discuss and celebrate the acquisition of BZW’s equities and investment banking business on Wednesday John Willcock reports. Merely by quoting “Project ********” to a telephone operator yesterday, The Independent was able to access a private video conference for CSFB’s top brass, during which they gloried in the acquisition of BZW’s equities and investment banking divisions this week for a paltry pounds 100m.
During the half-hour conference they forecast mass sackings in the London- based bank’s back office activities, and further redundancies among some of the investment bankers where they overlapped with CSFB.A UK executive boasted of the “carrot -and-stick” methods CSFB was using to get BZW employees to sign up for the Swiss bank. He said: “To date the direct impact of these developments on the US economy has been modest, but it can be expected not to be negligible.”Heavy buying by Japanese pension funds helped prop up the Nikkei yesterday. It ended just 7 points lower at 15,427.27, but had plummeted to as low as 15,083.22 earlier. Further declines are expected.Hong Kong staged a slight recovery, the Hang Seng index rising 113 points to 9,720.78.Shares in London and New York were little changed yesterday.