Weekly: State in clandestine asset-strip of freight rail firm Operail

Operail train at a crossing.
Operail train at a crossing. Source: Rene Kundla/ERR

The Estonian state has been asset-stripping freight cargo carrier Operail, investigative weekly Eesti Ekspress reports. Property belonging to the state-owned firm has been sold off, to the tune of tens of millions of euros, without the public being notified, the weekly adds. A major destination of assets leased or sold is the Russian Federation.

Eesti Ekspress wrote (link in Estonian) that: "There has not been any [public] announcement anywhere to the effect that all interested parties are welcome to purchase national rail transport company Operail's assets."

"Goods wagons operating on rail likes in Ukraine, Russia and other CIS states, along with business operations in Finland and the maintenance shed at Tapa are to be sold. Summing up, these four actions, directed at the company, are referred to as 'non-strategic business directions," the paper continued on its website.

The paper added that the second round of asset sales is already underway, though there is no information thereto to be found on the Operail website, either under the "asset sale and purchase" section, or the news section.

An Operail spokesperson said the sale of non-strategic assets, related to some business lines, is currently under preparation, while an external financial advisor has been hired for the purpose, who in turn has confirmed that there is nothing concrete to announce at the moment, Eesti Ekspress adds.

Operail has bought 2,600 rail wagons to lease to operators both in the Russian Federation and Ukraine, while the state invested €22 million into Operail in 2020, via a share capital raise.

While 2021 year end finished with a €5 million loss for Operail, dividends worth €9.5 million were received, compared with €1.5 million in 2021, Eesti Ekspress says.

However, the company's debt burden has grown by leaps and bounds, Eesti Ekspress adds, rising from just over €14 million at the end of 2016, prior to the wagon leasing operation commencing in Russia, to €93 million as of early 2022.

Investment bank Superia has been hired to advise on the sales; Eesti Ekspress notes that major players in the sector, including Marcel Vichmann, owner of Go Group, and Oleg Ossinovski, the owner of Skinest, have not been notified of the sales or invited to participate.

The original Eesti Ekspress article (in Estonian) is here.

As reported by ERR News, last October, the state announced it was planning to transfer its majority stake in Operail at the beginning of 2022.

Russian-language ERR TV channel ETV+ reported in April on its "Insight" show on potential assistance Operail was giving to the Russian war machine, following the February invasion of Ukraine.


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Editor: Andrew Whyte, Mait Ots

Source: Eesti Ekspress

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