Fragonset Railways was formed in 1997 as a spot hire company when four Class 47/7 locomotives were purchased from Waterman Railways with the operation initially based at the Tyseley Locomotive Works. In November 1997, Fragonset commenced its first contract providing locomotives for Virgin CrossCountry. A further Class 47/7 owned by the Lear family was also managed. A permanent base was established at the Railway Technical Centre, Derby. The locomotives were repainted into a new livery of black with a broad maroon mid-bodyside stripe.