"We continue to stand by our goal to bring about a privatization of Deutsche Bahn,'' Merkel said in a speech to Germany's BDA employers' federation in Berlin today. "I believe this is important and right.''

The Social Democrats, one half of Merkel's coalition, want the government to retain ownership of the 30,000-kilometer (18,600-mile) network, allowing the railway to run the tracks for profit. Their partners from the Christian Democrats want the government to run the track, splitting it off completely from Deutsche Bahn. The row has threatened to delay selling the asset.

Merkel has indicated that she's prepared to give lawmakers more time to end their dispute. Transport Ministry officials and lawmakers will meet Nov. 8 to resume talks on the sale. The ruling coalition this week is fine-tuning next year's budget, including investment in the railway.

"In politics, some things take a bit longer than business leaders can imagine,'' Merkel told the conference.

Switching the Burden

Merkel has planned a railway IPO as early as 2008, hoping to help her budget and steadily start switching the burden of investment from taxpayers to shareholders. The Bahn has invested about 90 billion euros since 2000, some 40 percent supplied by taxpayers, according to the Transport Ministry.

Germany wants to avoid "at all costs'' copying the U.K.'s example in selling the railway, where service quality plummeted, Merkel said at a tourist conference in Berlin yesterday. "Fifty- one percent of the railway will stay with the state in any event,'' she said.

Deutsche Bahn Chief Executive Officer Hartmut Mehdorn, speaking in an interview in Berlin today, said the company will post its ``best-ever'' result this year and ``is ripe'' for a share sale.

"We have done our homework, we need a decision,'' Mehdorn said.

CDU transport experts such as Dirk Fischer want the track to be included in the stake that the constitution bars the government from selling. That may help competition and secure influence as taxpayers continue to inject cash into the railway after an IPO, Fischer has said.

Solution?

SPD lawmakers including Uwe Beckmeyer have sought a way out of the impasse by proposing that the government should ``lend'' the track to the Bahn to develop its business and to be permitted to include the asset in its annual statement.

Federal investment in track from 2007 to 2010 may total about 12.5 billion euros ($15.9 billion), Transport Minister Wolfgang Tiefensee said on Oct. 27. The railway is Germany's biggest incorporated investor, landowner and occupational trainer, according to its own calculations.

Taxpayers would also gain a negative return on their investment if tracks are bracketed with rolling stock in a sale, CDU lawmakers have said. A sale of 49 percent of the company may yield just 9 billion euros, its Mehdorn is cited as saying in an interview published on July 30 in Stern magazine.

Deutsche Bahn's competitors carry about 7 percent of Germany's rail freight and about 10 percent of the country's passenger traffic.