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Disappointing bids for Hungarian rail freight business

The majority of bids lodged in the privatization of Hungary’s state-owned rail freight company MÁV Cargo have failed to reach the desired price of around Ft 80 billion ($433 million), the daily Népszabadság reported on Wednesday.

The newspaper said that only Slovakian consortium Sped Trans, with a bid of Ft 81 billion, met the government’s expectations in the first round of the process. According to Népszabadság, Germany’s Deutsche Bahn came in with the lowest offer at only Ft 44 billion. The second-highest bidder, the UK’s Ashmore Global, bid Ft 60 billion and will join Sped Trans, Romania’s Grampet, Hungary’s Magyar Rail Cargo and the Czech Republic’s Spedi Trans in the second round of bidding. A total of 12 bidders came in for the company, which is being advertised as a key regional logistics asset. An official announcement on who will enter the next round is due in around two weeks time. Companies that enter the second round will need to submit final offers by October 19.

MÁV Cargo had about an 82% share of the Hungarian rail cargo market in 2006. The company shipped around 47 million tons of goods last year, while its revenues rose 7.7% year-on-year to Ft 93 billion forints ($500 million). (monstersandcritics.com)