The government of Estonia has taken the next steps towards the privatisation of state rail operator Operail after the cabinet approved the finalisation plans proposed by the country’s Minister of Infrastructure Vladimir Svet. 

The privatisation plans have been in discussion for months and the auction process began in June 2024, but Svet has now revealed the government has received “a lot of interest” from potential new owners during the first stage of auction. 

He said: “I am pleased that there is interest in Operail and that we can move forward with the sales process. 

“A private investor can expand their business operations, allowing the company to continue its activities, while the state can direct its resources to strategically necessary activities.” 

Following the cabinet’s vote, the auction will now move into a second stage, with suitable investors now able to access additional information about Operail to submit a binding purchase offer, allowing the government to begin negotiations with bidders. 

After initially selling the company’s wagon leasing and freight transportation business in Finland in 2023, Estonia then announced it would seek to sell the remaining assets of Operail in February 2024. 

Svet said the decision was made due to an outlook by the government that rail cargo transport was “not a strategically important activity for the state”. 

The move comes at an important time for the country’s rail industry as work continues on the ambitious Rail Baltica network connecting Estonia with Poland, which recently received €1.2bn from the EU’s Connecting Europe fund.