Railway freight transportation firm PKP Cargo will carry out its initial public offering in the fourth quarter of 2013, subject to market conditions, the company said in a press release. The firm’s issue prospectus was submitted in July this year.
The offer is directed at institutional and retail investors in Poland and at institutional buyers in the US, the company said. After it is completed, state-owned railway holding PKP will retain an over 50 percent stake in PKP Cargo.
But before its planned stock exchange debut, the company will spin off a subsidiary, Windykacja Kolejowa, which will not be included in the IPO, Dziennik Gazeta Prawna reported. The spin-off, planned for October, is said to have been suggested by PKP Cargo’s privatization advisors.
Windykacja Kolejowa, which will be incorporated into the PKP group, will take over all of PKP Cargo’s claims against state-controlled infrastructure operator PKP Polskie Linie Kolejowe (PKP PLK). The claims arise from excess fees paid by PKP Cargo to PKP PLK for the usage of railroads. The total amount is estimated at zł.2 billion.
The move is an attempt to make PKP Cargo’s offer as transparent as possible. “We need as few unknowns as possible in PKP Cargo’s IPO,” said PKP group CEO Jakub Karnowski explaining the decision to transfer all claims to the spin-off firm.
PKP Cargo is the largest rail freight operator in Poland, with a 60.3 percent market share in terms of freight turnover, and the second-largest in the EU, with an 8.5 percent market share. In H1, the company saw its net profit drop to zł.76.8 million from zł.136.6 million a year earlier. The IPO is subject to regulatory approval.
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