Grindrod targets Transnet turf with rail venture

[Derek Walker]

From Business Report (February 27, 2009)

http://www.busrep.co.za/index.php?fArticleId=4863497

Grindrod wants to be a big player in the rail transport sector and the listed shipping and logistics firm has established a joint venture to drive the strategy into Transnet's territory.

The new company, RRL Grindrod, is 53 percent black-owned. It will provide locomotive leasing, shunting services and rail operations such as the building of train sets and the loading of rail wagons to its clients.

On Thursday Grindrod chief executive Alan Olivier said the finer details of the deal were being finalised. Grindrod was positioning itself to capitalise on business opportunities that would arise from rail restructuring in South Africa.

"At the moment it is difficult for private companies to operate in rail because of the monopoly by Transnet. We want to be ready if and when it becomes possible for private companies to operate," said Olivier.

RRL Grindrod already had shunting contracts at mines, Olivier said, and it wanted to expand on these. The entity has a fleet of seven locomotives.
Grindrod invested in rail previously through a 50 percent stake in Sheltam Grindrod, which it sold months ago.

T-sec economist Mike Schussler said this was good news because there was a need for competition in rail.

The rail plans show Grindrod is not resting on its laurels after an astounding 95 percent increase in headline earnings a share to R5.12 in 2008.....


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