Russian state-owned bank VTB has purchased Freight One. Earlier, the bank took over the rail freight operator’s management. In February, Freight One pledged nearly 70 thousand wagons as collateral to the bank to cover for its parent company’s financial obligations.

The acquisition of Freight One by the state-controlled VTB Bank was picked up behind the scenes by journalists attending Russia’s Eastern Economic Forum, according to press agency TASS. With the purchase, Russia’s largest freight operator is being nationalised.

“We bought it”, the bank’s head Andrey Kostin reportedly said. He clarified that the bank spent 200 billion rubles (2 billion euros) on the purchase, taking into consideration that the company had an outstanding debt with the bank.

In early August, Russian publication Kommersant reported that the bank had taken over the company’s management. VTB was reportedly not “dissatisfied” with the state of affairs surrounding the acquisition of Freight One by investor Aurora Invest in November 2023. As part of the acquisition, “promises were made to the parties involved and credits, including VTB.”

The previous parent company, Aurora Invest, did not hold on to Freight One for long. It acquired the operator in November 2023 for an estimated 220 billion rubles.

Market consolidation

Kommersant writes that the bank’s acquisition of Freight One is the first step towards market consolidation. A next step could be a merger with asset manager Transfin-M and rail freight operator Atlant, which the bank already controls.

A 2015 plan to consolidate 200,000 wagons under one operator is now also resurfacing. To put the plan into practice, Russian Railways’ freight branch Federal Freight could be taken away from the state operator and merged with Freight One.

If that were to happen, it would merely be a reorganisation of operators under state control now that Freight One has been taken over by VTB. A Kommersant source also emphasises that a new owner of Federal Freight would be required to use its assets for state purposes right away.