Monday 16 April 2012 8:44 pm

Georgian state railway builds up steam ahead of London IPO

GEORGIA yesterday announced plans to sell up to 25 per cent of shares in the state railway monopoly through a float on the London Stock Exchange (LSE) that could raise as much as $200m (£126m). Free to set its own tariffs, the railway boasts one of the largest profit margins in the global rail industry and net income growth of 72 per cent for the last year. The firm also benefits from a strategic position on trade routes between central Asia and Europe with 95 per cent of the railway’s $285.8m revenues coming from freight income. “We are already one of the very few railway companies in the world delivering profitable growth without reliance on government subsidy. Our IPO will support our long term expansion plans in the region,” said Irakly Ezugbaia, the Georgian Railway chief executive. Citigroup and Goldman Sachs International have been appointed as joint global coordinators and joint bookrunners. The IPO, part of a programme of privatisations in Georgia, would take place in the form of Global Depositary Receipts. In February Bank of Georgia became the first Georgian company to gain a premium listing on the LSE.