A major French union is emphasising this morning’s (19 September) announcement by Russian Railways (RZD) it is to enter into sole talks to acquire 75% of PSA Peugeot Citroen logistics division Gefco, is a further example of the automaker selling the “family silver.”
RZD has made a binding offer for 75% of Gefco in a deal thought to be worth around EUR800m (US$1.2bn), with the Russian train operator retaining the French subsidiary’s management and all its existing business units, including those providing services to PSA.
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However, French labour body, Force Ouvriere, whose secretary general, Patrice Clos, is also on Gefco’s Works Council, expressed union uncertainty surrounding the new owner’s staffing intentions, although nothing has yet been announced.
“They have sold the headquarters [in Paris] and they will sell Gefco – selling all the family silver,” Clos told just-auto from Paris.
“We have some worries – on a social level we need to know the strategy of the group. We will stay very vigilant for any redundancies [although] we have not heard of job losses.
“PSA is burning EUR200m per month – EUR800m is quite quick to burn – [but] will allow them to breathe a bit. Now with the Russians, it is the first time Russians will invest [into a] French transport logistics [company] like Gefco.”
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By GlobalDataRussian Railways said it had been attracted to Gefco due to its position as one of Europe’s top ten major logistics providers and its potential to reduce cost.
“The acquisition of Gefco would help Russian Railways to promote the attractiveness of transit cargo flows along the Europe – Asia transcontinental route,” an RZD statement sent to just-auto from Moscow said.
“Russian Railways has recently undertaken a significant amount of work to be in a position to offer competitive transportation services along this route. The next logical step would be the development of the sales network for transit transcontinental transportation services via an international logistics company.”
RZD will now undertake mandatory talks with Works Councils, while the deal is still subject to approval by anti-trust authorities in both countries. JP Morgan and VTB Capital will be Russian Railways’ joint financial advisers for the transaction.
Russian Railways is the sole owner of the rail track and key rail infrastructure in Russia and one of the three largest transport groups in the world with freight turnover of almost 2.7bn tonne-kilometres in 2011 and around 130bn passenger-kilometers.
Net income is EUR4.5bn.
