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Business news, 11.03.2004 10:52

Oktyabrskaya Railroad and Leningrad Region creating a joint passenger transportation company

Oktyabrskaya Railroad The Leningrad Region Administration and the Oktyabrskaya railroad (OZD) have reached an agreement on creation of a joint passenger transportation company.

The parties have not divulged the cost of the project, saying the price has not been determined so far. In the words of Victor Stepov, the Director General of the Oktyabrskaya railroad, an affiliation of the open joint-stock company Russian Railroads, OZD can join the authorized capital of Russian Railroads company through its rolling stock, while the Leningrad Region is to search for investments in the project. However, OZD will also be attracting investments, especially in railroad infrastructure development, in lengthening of trains, and in arranging speed passenger trains for the most popular destinations. The railroad company intends to place its orders in the enterprises of the Leningrad Region. Currently OZD has employed the Tikhvin enterprise Titran to build wagons.

The Governor of the Leningrad Region, Valery Serdykov, said that in the short-run perspective an additional agreement would be signed to introduce special procedures to clear off the restructured debts of OZD on taxes and dues going to the regional budget. The railroad indebtedness is about 45 million rubles. The Leningrad Region is planning to use its debts to cover the OZDís local transportation losses.

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