Berlin - The Social Democrats in Germany's coalition government moved Monday to a position that would sharply limit Chancellor Angela Merkel's plans to privatize the state-owned German railways company Deutsche Bahn.

The privatization is one of the Merkel government's few remaining economic-reform targets, but has come under fire from resurgent German leftists, who say trains should remain a government service.

The railtracks and stations are to remain government owned. Plans to privatize the trains as an operational business similar to a bus and truck company have been gradually whittled down.

Berlin-based Bahn is one of the world's biggest railroad companies and also owns large road-transport businesses operating in several European nations.

Party leader Kurt Beck had met Sunday evening with senior Social Democrats to draft a policy that would cut the proposed private stake in the future passenger and freight company to just 24.9 per cent, instead of 49.9 per cent as sought by government ministers.

Beck declined to disclose policy details, but other senior party aides told reporters in Berlin of the arrangement. A formal announcement was not expected till later Monday after consultations within the party.

In the past, Social Democratic ministers have sided with Merkel, a Christian Democrat, on the issue, which has caused friction among Social Democrats and frustrated Bahn's attempts to launch an initial public offering. (dpa)