Tartu Mill owners submit best offer for state-owned railway company Operail
In the tender auction for the sale of Estonian the state-owned railway company AS Operail, the best offer was made by AS Tiigi Keskus, the company that owns Tartu Mill. Negotiations are set to begin shortly regarding the signing of the purchase contract.
A number of interested buyers both from Estonia and abroad qualified for the second round of the tender, according to the Ministry of Climate.
Based on the mandate given by the government, Operail's supervisory board has decided to enter into negotiations with AS Tiigi Keskus, which submitted the best bid, to sign a privatization contract.
"If the final negotiations are successful, a sale and purchase agreement will be concluded with the winner of the tender and, once the terms of the agreement have been fulfilled, the transaction will be finalized – AS Operail's freight transport and repair store of will be handed over to the new owner," the ministry said.
Tiigi Keskus is an Estonian-capital based asset management company whose core business is property management. The company additionally owns a majority stake in Tartu Mill, the largest food grain processing and pasta production group in the Baltics.
"For Tiigi Keskus, the rail business is a new and promising direction which has certain synergies with our existing business. We plan to continue to provide high quality freight and rolling stock repair services in Estonia and also to expand geographically," said Tiigi Keskus management board member Uuno Lausing.
If the negotiations do not lead to the signing of a sale-purchase agreement, other potential buyers who also submitted binding offers in the auction will have the opportunity to start negotiations on a sale contract. For this reason, more detailed information on the auction process and results, including the number of bidders and the sale price, can only be published after the transaction has taken place, the ministry said.
The auction for the sale of Operail's freight transport and repair business started on June 7, when a two-stage auction was launched to find a buyer.
AS Operail is a state-owned company under the administration of the Ministry of Climate, which is active in freight transport on Estonian railways and in the maintenance and repair of rolling stock. Until the start of 2023, Operail was also engaged in the leasing of wagons and the transportation of goods in Finland, however, the owner decided to cease these lines of business. In February 2024, the government made a substantive decision to privatize Operail's remaining business lines.
--
Follow ERR News on Facebook and Twitter and never miss an update!
Editor: Michael Cole
