Port of Tallinn: Privatization would help improve company's image abroad
Valdo Karm, chairman of the board of Estonia's Port of Tallinn, regards the incoming coalition's plan to sell off a minority stake in the state-owned port operator as positive, saying that it would focus the administration of the company more on business as well as improve its image outside of Estonia.
"The listing of shares of state-owned enterprises on the stock exchange is bound to revitalize the local stock market and will help make our enterprises known outside of Estonia as well," Kalm told BNS on Friday. "I view this as a positive decision that will help make the running of state-owned companies more transparent and business-focused."
Privatization will contribute to the strengthening of the Port of Tallinn's reputation in particular outside of Estonia, which is extremely important from the viewpoint of the company's business, the CEO noted. "Listing will expand capital-raising opportunities in later phases as well, and it will be easier for a listed company to issue bonds, for example," he observed.
Before a partial divestment of shares it is essential to know the purpose for which extra capital is being raised, Kalm continued. The Port of Tallinn's major investments in the coming years are connected with passenger services infrastructure and real estate development at the Old Town Harbor. "We are currently not sure whether the listing of a minority stake in the Port of Tallinn will generate additional cashflow for the company or whether it will be used for some other investment important to the state," he said.
Kalm emphasized that the Port of Tallinn was in principle ready for listing. "Bonds for the Port of Tallinn were listed on the stock exchange from 2003-2009," he remarked.
The new governing coalition being established by the Center Party, the Social Democrats (SDE) and the Pro Patria and Res Publica Union (IRL) intends to sell off minority stakes in the Port of Tallinn, Eesti Energia's renewable energy arm Enefit Taasutvenergi and rail cargo operator EVR Cargo as well as divest all shares in road construction and maintenance firm AS Eesti Teed.
The plan is to sell up to 30 percent of shares in the Port of Tallinn as well as up to 49 percent of shares each in both Enefit Taastuvenergia and EVR Cargo.