The Railways Corporation restructured the operations of the railway network substantially during the 1980s, reducing staffing levels, closing workshops, and introducing a number of measures to increase productivity, such as removing guard's vans, increasing train lengths and introducing new, heavier bulk bogie wagons.

[7] Business journalist Brian Gaynor noted that New Zealand Rail was an attractive investment because of its strong balance sheet.

[10] The company had gained its shareholding by selling its fibre optic network along the North Island Main Trunk to Clear.

On the same day Tranz Rail Holdings Limited made a $100 million capital repayment to the Fay Richwhite consortium, largely financed by the sale of shares in Clear Communications.

In December 1996, Tranz Rail sold the DFT class of locomotives to the Chicago Freight Car Leasing Company for $131.5 million.

In 2004 this share was purchased by Toll NZ, as one of the West Coast Railway directors had died and the business was not performing adequately.

[20] Michael Beard became CEO of Tranz Rail in 2000 following the retirement of Dr Francis Small who had led the organisation from its SOE days into its first phase of privatisation.

[citation needed] Beard also moved Tranz Rail's headquarters from the Wellington railway station to a new purpose-built office on the North Shore of Auckland, at a cost of $16 million.

[21] In 2000 a ministerial inquiry was formed to look into Tranz Rail's safety record,[23] due to an unusually high number of work-related fatalities over the previous 12 months.

The Awards came amidst critical reports of lax safety standards, inadequate maintenance, asset stripping and insider trading.

In June 2003, the Government announced that it would buy back the rail network for $1 and purchase a 35% stake in the firm for $76 million (67c per share), which would have given it effective control of the company.

This met with approval from the Rail & Maritime Transport Union (RMTU) which had run a vigorous "Take Back The Track" campaign for the government to renationalise the railway network.

The Government reached a Heads of Agreement with Toll later that month, and eventually bought the rail network for $1, plus $50 million for property assets including leases and Wellington railway station.

The parties agreed the Government would spend $200 million over the next five years upgrading the track via the New Zealand Railways Corporation, operating as ONTRACK.

After a number of extensions of the deadline set by Toll, it held 84.2% of shares in Tranz Rail after the offer closed in December 2003.

By that time, shares were being sold on the New Zealand Sharemarket for $1.65, above even the independent valuation of between $1.34 and $1.62 made in July by merchant bankers Grant Samuel.

The departure of the former chief executive officer, Michael Beard, and six other top managers cost it $6 million in exit payments.

In May 2008, the New Zealand Government agreed to buy the rail and sea transport assets of Toll NZ Limited for $665 million.

[30] Rail freight volumes 1993 – 2003 (year ending 30 June):[30] In late 2004, the New Zealand Securities Commission launched an investigation into the company regarding alleged insider trading.