NGKT to invest $300 million in Polish State Railways
NG Koleje Telekomunikacja (NGKT) signed a $46.5 million agreement last week with Polish State Railways (PKP) to lease 5,300 kilometers of the rail operator's fiber-optic lines for 15 years. The agreement will enable NGKT to lease up to an additional 2,000 kilometers from PKP for $17.5 million.
The British-Polish telecom consortium will spend the money on developing its fiber-optic network for data transmission services for Internet access and e-commerce in Poland.
The investment will enable the financially troubled PKP to form a separate company for telecommunications services, which it intends to eventually spin off, Andrzej Celinski, the president of PKP, said at a news conference last week. The sell-off is part of PKP's plans to separate its rail transportation service from its unrelated business interests as part of the railway's overall restructuring and eventual privatization.
NGKT plans to invest $300 million in Poland during the next two years, and expects to employ about 300 local staff and an additional 350 employees on an indirect basis.
The NGKT consortium consists of British firms Energis and National Grid, which each hold 23.75% stakes, PKP with a 42.5% stake and Polish Telecom Operators (PTO) with a 10% stake. It was one of three consortia to receive an operating license for domestic long-distance voice service last January. However, the firm has not paid for or collected the license because of its disagreements with the Communications Ministry over Poland's telecom regulations.
Michal Marczak, a telecoms analyst at BRE Bank Securities, said that despite the huge dollar amount of the investment, NGKT would only be likely to offer data transmission services to business clients, but not to residential ones.
While the company would have access to PKP's existing cross-country network, it would still lack access to local loops, intra-city networks that would stretch data transmission service into the homes of urban subscribers, he said. NGKT would likely have to team up with local internet service providers to realize its plans, he said.
