Operail, the Estonian state-owned railway company, announced it has sold its Ukrainian wagon fleet with transactions totalling EUR 6.51 million.
20 companies participated in the competition and the best was the combination of two participants comprising the companies Fortior Capital from Ukraine and Teslar Trans from Estonia. In total, agreements were signed for selling 552 wagons.
The opportunity to participate in the auction of the assets of Operail Leasing AS, a subsidiary of Operail, was introduced to more than 40 companies. “Considerable operators on the 1,520 mm railway who could have an interest and ability to purchase knew about the competition and were able to participate,” Merle Kurvits, member of the management board of Operail and Managing Director of Operail Leasing said. 20 interested parties made their offer at different stages of the process, including several Estonian companies.
Following offers assessment, Operail decided to sell the wagons in two stages which includes the wagons in Ukraine and the rest of the wagons separately, Merle Kurvits said.
The Ukrainian wagon fleet is different from other wagons because they cannot be brought out of the country. “Most wagons are untouched by war, are in working condition, and are earning rental income on the Ukrainian territory, but railway connections with neighbouring countries are poor,” Kurvits said.
Comprehensive negotiations with the best tenderers followed. “It is an expensive and technically specific asset that was sold together with valid rental agreements – there are a lot of details that need to be worked out. In view of the war in Ukraine, these are good sales transactions for Operail,” Kurvits explained.
In addition to the wagons located in Ukraine, the process of selling the remaining 2,000 wagons of the wagon rental business is in the final stages comprising negotiation of contracts of purchase and sale with the best tenderers. Most of the wagons are covered by rental agreements. All tenants are European companies. The wagons are mainly located in Estonia, Kazakhstan, and Mongolia and no wagons have been rented to Russia.
The sale of wagons is not related to the Russian aggression in Ukraine. Estonia decided to leave the non-strategic business areas of Operail in 2016, when this idea was written in the coalition agreement. In practice, the owner was able to sign the corresponding decision in the spring of 2021. The rental of wagons has been the most profitable business area of Operail for the past six years, with 99% of profits coming from it.
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