"Nurminen Logistics Group was able to acquire North Rail (formerly Operail Finland – EE) for less than its fair value because the seller (the Estonian state – EE) decided to divest its Finnish business," Eesti Ekspress reported, citing Nurminen's half-year report published in December 2023. "The €12.3 million, which is considered income, represents the difference between the sale price and the fair value of the assets," it added.

Ekspress noted that it had already written in August 2022 about how Operail was being privatized without involving the public or Estonian railway businessmen, although generally, the best price for the state and its taxpayers is achieved through a public competition.

Raul Toomsalu, who was leading Operail at the time of the transaction and left his position in December 2023, disagreed with the claim of secrecy and confirmed to the newspaper that hundreds of companies were invited to participate in the competition. "To my knowledge, there were no complaints from any company claiming they were interested in the Finnish assets but unable to participate," he told Ekspress.

In a transaction confirmed in February 2023, the main assets of which were locomotives, Operail Finland was sold for €27.7 million, of which €18 million covered the loan used to purchase the locomotives and €9.2 million was net assets, mainly the equity value of the locomotives. According to Nurminen's calculations, however, this is now valued at €21.5 million, which means a gain of €12.3 million for the buyer.

Ekspress highlights that the sale was also influenced by the war initiated by Russia in Ukraine, which significantly reduced the interest of international investors, which, according to Operail's current CEO Merle Kurvits, had been high before the war. The rush and the pressure from the Estonian government to end Operail Finland's nickel transportation to Russia might have also played a role. Then Minister of Economic Affairs and Communications Riina Sikkut (SDE) did not want to evaluate whether the state incurred a loss from the sale, as she does not know the basis on which the company was later valued higher.

In March, ERR's news portal relayed information (link in Estonian) from the Finnish national broadcaster Yle about how the logistics company Nurminen Logistics continues to make a substantial profit by transporting Russian nickel and fertilizer in Finland, which are not under sanctions, thus making trade in them still a profitable business.

--

Follow ERR News on Facebook and Twitter and never miss an update!