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31 Jul, 2008 02:02

Russian railways to commence sell off

The President of Russian Railways, Vladimir Yakunin, wants to sell stakes in everything the company owns over the next two years, except the rail network. Yakunin now claims Russia's rail operator will never sell off the track itself.

Russian Railways will start selling stakes in its locomotives, freight and passenger cars from October. The private investment that will bring has led to calls for selling the track itself, the world's longest, and one of the most decrepit. The company's President said if Germany wouldn't sell off its network, neither would Russia.

Taking into consideration the experience of Deutsche Bahn, everything but infrastructure can be IPO'd.

Yakunin later told Business Today the track will never be sold off, as the US and Britain have already done.

Elena Sakhnova, Head of Transport Analysis at VTB Bank explained why Russia was wary of selling its track, but revealed the sale of everything else could still bring in billions.

Rail infrastructure is the security of your country so I can understand the decision not to privatize it.  Up to 10 billion dollars can be raised as a result of privatization of all companies.

Anatoly Chubais boasts full privatization of his electricity empire may make it the world's most efficient within a decade. Yakunin rejected that model on Wednesday, claiming he's still working on making the network presentable after “decades” of underinvestment.