Eltel has signed a letter of intent (LoI) to sell its Danish rail operations to infrastructure solutions provider Strukton Rail.

Both parties are expected to finalise the definitive transaction by the end of this month.

Go deeper with GlobalData

Premium Insights

The gold standard of business intelligence.

Find out more

Related Company Profiles

View all
"The deal would see Strukton Rail acquire Eltel’s current maintenance contract with Sund & Bælt, in addition to the transfer of 26 employees and operational equipment."

The deal would see Strukton Rail acquire Eltel’s current maintenance contract with Sund & Bælt, in addition to the transfer of 26 employees and operational equipment.

It is expected to have an estimated negative EBITA effect of kr7.7m ($1.25m) and a negative cash flow effect of kr18m ($2.91m), which is anticipated to occur in the last quarter of 2017 and first quarter of this year.

The contract is valid until March next year and features a one-year extension option.

Eltel originally announced its intention to focus on its core businesses of power and communication within Nordic region, Germany and Poland in February last year.

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData
Visit our Privacy Policy for more information about our services, how we may use, process and share your personal data, including information of your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.

Accordingly, the company aims to divest its rail operations, which are classified as its non-core business.

Eltel also signed a deal to divest its Finnish rail business operations to infrastructure constructor Graniittirakennus Kallio in November last year as part a deal valued at €8.5m.

Eltel’s Finnish rail business operations generated net sales of €28m in 2016 and are primarily focused on the delivery of railway, metro and light rail electrification and signalling systems.

The company is also currently undertaking the divestment of its rail operations in Sweden and Norway.