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Churnet Valley Railway (1992) PLC

Share Prospectus 4 Reopened Spring 2017!

During 2013 the Churnet Valley Railway achieved one of the main objectives of its 4th share issue, in that the company used funds from the issue to secure a 7% shareholding in Moorland & City Railways Ltd (MCR). The share purchase also gave CVR a seat on MCR’s Board and thus an influence on MCR’s policies and activities, especially in the area of heritage matters. In addition, a significant amount of funds were left “on loan” with MCR, either to purchase further MCR shares or to support the expansion of CVR’s interest in the MCR network.

One of MCR’s principal aims, the movement of freight by rail from the Cauldon Lowe Quarries, was forced to be place “on hold” due to the involvement of the Mergers & Monopolies Commission with the recently merged quarry owners. Whilst this matter was resolved, MCR turned their attention to another of their objectives, that of getting a rail service back into the area’s principal town – Leek. Disapointingly the Council chose to reject the plans in April 2016, and so MCR returned to their primary aim of re-opening the Stoke - Cauldon line for freight.

Because of the close connections between the two railway companies, Churnet Valley Railway would be the first to benefit from MCR extending its lines the short distance into Leek and the establishment of a suitably sized station building on the outskirts of the town, something which is now being developed through alternative means.

Protracted negotiations between MCR and Network Rail continue regarding the Stoke line, which when concluded will give MCR the opportunity to purchase the Stoke branch in its entirety. As part of these discussions MCR has already obtained agreement for CVR to run a limited number of heritage trains (steam and diesel) to Endon, ahead of the line’s purchase, but all subject to the Network Rail/MCR contract being signed and HMRI approving the line for heritage services.

As a separate issue, but under the banner of the CVR share issue 4, the Churnet Valley Railway purchased the trackwork that is in situ between Leek Brook Junction and Ipstones, which was owned by MCR but will ultimately require replacement with modern heavy rail when MCR secures a freight contract with which ever company eventually owns the quarry at Cauldon. This was achieved by re-opening Share Issue 4 in summer 2014, and the purchase was succesfully completed in Autumn 2016, giving the CVR the chance to further support and take a stake in this expansion of the rail network within the Staffordshire Moorlands, as well as protect our current running rights over the branch and our highly popular Cauldon branch services. 

Then in May 2017 a one-off offer was received from Staffordshire County Council, offering the CVR the chance to buy out the lease from Cheddleton Station for £50,000. To cover the cost of purchase and urgent repairs to the building, Share Issue 4 was once again re-opened for a 3-month period - this being the deadline given by the Council to complete the purchase.

Shares cost £1 each, minimum purchase £100. As well as a range of benefits and travel concessions, shareholders may also qualify for 30% tax relief on investments over £500 under the Government’s Enterprise Investment Scheme. 


MCR is a commercially driven company with the following objectives :-
  • To create a nationally significant sustainable rail network which will include major freight, passenger and heritage running.
  • To achieve large scale carbon emission reductions and general environmental benefits in its region by way of a modal transport shift for freight and passenger movement from road to rail.
  • To establish substantial heavy freight flows from the Cauldon quarry and cement manufacturing operations.
  • To extend its line via the Churnet Valley Railway’s line through to Alton Towers Theme Park.
  • To extend its line from Leekbrook back into Leek and thereby reconnect the town and the Moorlands District in general to the national railway network at Stoke.
  • To assist in the regeneration of its region by providing sustainable access to a variety of development projects in Leek, the Churnet Valley and along its route.
  • To achieve income and capital growth through its share structure for all its investors.
  • Also, MCR wishes to see the Churnet Valley Railway expand its operations and status in the heritage railway world and will make all its lines available for use at no charge to the Churnet Valley Railway as and when they become available.
 
The Benefits of the MCR Project to the Churnet Valley Railway
 
The MCR project, when fully completed, will have the following benefits to the Churnet Valley Railway:
  • Thirty miles of running line (including the CVR’s line). 
  • Four different routes all available at no cost to the CVR.
  • Destinations at Leek and Stoke.
  • A main line connection at Stoke.
  • Valuable income paid to the CVR by MCR for the use of its line in connection with running its services to Alton Towers.
  • A likely doubling in visitor numbers.
  • The development of the CVR’s operations into one of the UK's major heritage railways with the longest running line in the country.
The CVR’s Shareholding

This shareholding will bring several corporate advantages:-
  • A seat on the MCR Board which a CVR independent director now occupies.
  • Through its shareholding, the CVR will have full knowledge and a level of influence over the development of the MCR project, particularly in relation to heritage running.
  • MCR's shares are intended to have an annual return and a capital value based on its commercial activities. This will, in due course, provide the CVR with an income and the value of the shares will be reflected on the CVR's balance sheet.

 

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