Now SNCF considers the future for Novatrans
Sale of loss-making combined transport subsidiary the first option, but restructure and liquidation are also on the cards
SNCF is planning to either sell or recapitalise its heavy-loss-making road-rail freight transport subsidiary, Novatrans.
Novatrans, which employs 260 staff, is reported to have been in the red to the tune of €22 million last year, following a €35 million loss in 2010.
Failing these options, liquidation could be on the cards.
SNCF acquired Norbert Dentressangle’s 15.1% stake in Novatrans in June 2009, bringing it a majority shareholding in the company.
Novatrans was then on the brink of bankruptcy and had just announced 100 job cuts. The French state rail operator has sunk €60 million into Novatrans since it took control, but over two-and-a-half years on, its financial position is as precarious as ever.
Addressing France’s combined transport association, the GNTC, last October, SNCF Geodis CEO Pierre Blayau accepted that the group had “perhaps made mistakes” with Novatrans.
At the beginning of last month, a new MD was appointed – Charles Puech d’Alissac succeeding Tarek Hosni – but SNCF plans to appoint a bank on a two-month mission to find a buyer for Novatrans.
However, given the scale of its losses, it is difficult to see the company attracting much interest.
The recapitalisation option would consist of injecting €50 million of fresh capital by the end of the year, accompanied by a severe restructuring plan.
This would almost certainly involve axing routes, most of which are losing money, and closing some of its 13 freight terminals.
However, the plan could fall foul of the EC’s competition regulations as it would risk laying open SNCF to a charge of providing state aid to the operator in disguise, in the same way it did with SeaFrance.
SNCF Geodis’s financial director, Olivier Storch confirmed that in April, the two options of sale or recapitalisation wwould be assessed.
If neither is considered viable, steps would be taken to liquidate Novatrans, with is staff offered jobs elsewhere in the SNCF group.
Novatrans, which employs 260 staff, is reported to have been in the red to the tune of €22 million last year, following a €35 million loss in 2010.
Failing these options, liquidation could be on the cards.
SNCF acquired Norbert Dentressangle’s 15.1% stake in Novatrans in June 2009, bringing it a majority shareholding in the company.
Novatrans was then on the brink of bankruptcy and had just announced 100 job cuts. The French state rail operator has sunk €60 million into Novatrans since it took control, but over two-and-a-half years on, its financial position is as precarious as ever.
Addressing France’s combined transport association, the GNTC, last October, SNCF Geodis CEO Pierre Blayau accepted that the group had “perhaps made mistakes” with Novatrans.
At the beginning of last month, a new MD was appointed – Charles Puech d’Alissac succeeding Tarek Hosni – but SNCF plans to appoint a bank on a two-month mission to find a buyer for Novatrans.
However, given the scale of its losses, it is difficult to see the company attracting much interest.
The recapitalisation option would consist of injecting €50 million of fresh capital by the end of the year, accompanied by a severe restructuring plan.
This would almost certainly involve axing routes, most of which are losing money, and closing some of its 13 freight terminals.
However, the plan could fall foul of the EC’s competition regulations as it would risk laying open SNCF to a charge of providing state aid to the operator in disguise, in the same way it did with SeaFrance.
SNCF Geodis’s financial director, Olivier Storch confirmed that in April, the two options of sale or recapitalisation wwould be assessed.
If neither is considered viable, steps would be taken to liquidate Novatrans, with is staff offered jobs elsewhere in the SNCF group.
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