Romania’s state-owned freight railway company, CFR Marfă, is set to be liquidated following the completion of its pre-insolvency arrangement next March, according to Ziarul Financiar, which cites officials from the Ministry of Transport. 

CFR Marfă, which generated revenues of RON 778 mln (EUR 157 mln) in 2023 but is burdened by debts amounting to RON 4.5 bln (EUR 910 mln), will be replaced by a newly established entity, Carpatica Feroviar.

The Romanian government justified the establishment of Carpatica Feroviar as needed to deliver strategic services under crisis situations – but will also have the option to provide commercial services on the free market.

Ionuț Cristian Săvoiu, Secretary of State in the Ministry of Transport, confirmed that CFR Marfă’s pre-insolvency proceedings would conclude in 2024, allowing sufficient time to operationalise Carpatica Feroviar, which will take over CFR Marfă’s market role. 

“The preventive arrangement will end next year after the period necessary to operationalise the company that will continue serving the market and replace CFR Marfă, which will be liquidated in the end,” Săvoiu said.

The government recently approved the formation of Carpatica Feroviar. Its capitalisation, as well as the procurement of rolling stock required to compete in the market, will be aligned with the business plan and the private investor test agreed upon with the European Commission’s DG Competition, Săvoiu assured. He also clarified that CFR Marfă and Carpatica Feroviar will not operate in parallel, with the latter fully replacing CFR Marfă once it becomes functional.

This restructuring marks a significant step in addressing the longstanding financial difficulties of CFR Marfă, as Romania seeks to ensure the continuity of its freight railway services under more sustainable conditions. Private operators, however, objected to possible breaches of the competition regulations.

iulian@romania-insider.com

(Photo source: Facebook/CFR Marfa)