Russian Railways to up stake in FELB to 50% in 2013, collect $22.5 mln debt
MOSCOW. July 11 (Interfax) - RZD Logistics (RZDL), a subsidiary of Russian Railways (RZD) , plans to increase its stake in Austria's Far East Land Bridge (FELB) to 50% by the end of 2013.
"In 2013, RZD and its subsidiaries plan to implement a number of measures to increase their equity stake in FELB to 50%. [This] will guarantee the repayment of FELB's debt in 2013," RZDL materials state.
FELB carries containers by rail through CIS countries between Europe (Austria, Hungary, the Czech Republic, Slovakia, Poland and Germany) and the northeast provinces of China.
TransContainer, which is controlled by RZD, previously owned 10% of FELB, which it acquired after extending a six-month loan to the Austrian company. Last year these shares were acquired by RZD Logistics, which said it planned to "increase its stake to 25%." At the same time, RZDL also took over FELB's debt to TransContainer of $22.5 million (the debt was estimated at 683.4 million rubles as of December 31, 2012).
Information on RZDL's website shows that the company has already exercised an option to buy 15.1% of FELB, increasing its stake to 25.3%.
RZDL materials state that RZD "includes the business of FELB within the perimeter of its key strategic interests" and "is holding negotiations on the global logistics company investing in its equity for the development of the potential of the China-Europe transit overland route."
RZDL's website states that FELB "will soon become part of the Unified Transport Logistics Company" (UTLC) and this "should have a positive impact on the organization of freight traffic."
A letter of intent to create UTLC was signed in June by the national railways of Russia, Belarus and Kazakhstan. The company will carry container freight within the Common Economic Space, including transit freight between Europe and Asia. RZD plans to contribute its stake of 50% plus 2 shares in TransContainer to the joint venture, as well as 100% of RZDL. Kazakhstan will contribute Kaztransservice and terminals at the Dostyk and Altykon stations, and Belarus will contribute freight terminals in Brest and "other assets."
RZDL is a wholly owned subsidiary of RZD founded in 2010 as part of the development of the railway monopoly's logistics business. The company provides door to door service, handling rail, truck and marine shipping, warehouse storage, terminal handling, customs processing and insurance thanks to their integration within the RZD group.
Vp ak
(Our editorial staff can be reached at eng.editors@interfax.ru)\