Deutsche Bahn tracks private funds for growth.

(From Lloyds List)

Byline: German logistics giant still weighing up part-flotation to bankroll expansion, writes Katrin Berkenkopf in Duisburg

German railway and logistics operator Deutsche Bahn feels that a part-privatisation of the group and an inflow of private money is necessary in order to further expand the logistics business.

'The industry is facing an enormous process of consolidation over the next years,' said chief executive Hartmut Mehdorn. 'We want and we have to participate in that.'

Mr Mehdorn still believes that a part-flotation of Deutsche Bahn is possible in the second half of 2008, despite continuing political discussions about the issue.

After the acquisition of BAX Global in 2005, the parent of Schenker sees itself as number two in global logistics services. With a turnover of €13.2bn ($17.6bn) achieved last year by Schenker'BAX, the group was surpassed only by Deutsche Post with its subsidiaries DHL and Exel, Mr Mehdorn said. Deutsche Bahn group on the whole saw a turnover of € 30.1bn, up 20% on the previous year. This was mainly thanks to the inclusion of BAX, without that effect the increase would have been 8%, the chief executive said.

The logistics division is completed by the activities of rail cargo operator Railion, which recorded a turnover of €3.2bn last year. Schenker achieved earnings before interest and tax of €367m last year; Railion saw €226m. Rail cargo had the highest growth rate among all cargo transport modes in Germany in 2006, Deutsche Bahn pointed out.