First Freight Company Loses Prospective Investors

29 September 2011 (10:11)

First Freight Company, the Commonwealth of Independent States’ largest railway carrier belonging to Russian Railways is losing its potential investors.

According to Kommersant, the leading Russian railway operator Globaltrans backed out of an auction where a 75% shareholding of First Freight Company was open to bids. The auction is to take place on October 28, 2011.

The opening bid has been set at 125.37bn RUR. Bidders can submit their applications until October 14, 2011, the newspaper notes.

Now two of Globaltrans divisions actually asked the Federal Antimonopoly Service for a permission to buy First Freight Company: New Carrier Company and Sevtechnotrans. At the same time, Globaltrans looked into the company’s business activity and obtained a detailed estimate of its post-purchase efficiency enhancement potential.

In the end, Globaltrans BOD decided the significant increase in liabilities occasioned by the financing of this transaction was too great a risk for the business given the current situation on the financial markets.

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