Russian Railways mulling options for attracting investor for Federal Freight Company - CEO

MOSCOW. March 18 (Interfax) - Russian Railways (RZD) is exploring possibilities for bringing an investor into its Federal Freight Company (FFC).

"A decision on selling FFC has not been made. But the issue of working out possibilities for a sale, we have such an instruction, we're working on it, assessing in order to propose further steps. We will certainly propose to leave control with Russian Railways," RZD CEO Oleg Belozerov said in an interview with Interfax.

"The possibility of attracting an investor, we're actually considering it right now. Meaning this is one form, what we're talking about is the possibility of raising funds under our management," Belozerov said.

FFC is an important asset for RZD, as it fulfils various specialized functions, including social ones, he said.

"Through FFC we create special mechanisms for working with small businesses, we're working through the electronic exchange for railcars, plus we're launching new products. The market is always conservative and trying to use only proven mechanisms," Belozerov said.

FFC was created in the course of Russia's railway transport reforms on the basis of RZD's freight car fleet and is now one of the largest freight rail operators in the country. FFC operates 134,300 pieces of rolling stock and has 14 branches and transport services agencies on the country's railways, according to its website. FFC closed 2024 with a net profit of 47 billion rubles on revenue of 127 billion rubles to Russian Accounting Standards.

National daily Kommersant, citing a source, reported in mid-January that RZD might sell 49% of FFC for 44 billion rubles. The sale is part of a plan to improve RZD's finances and fund its 2026 investment program of 713.6 billion rubles.