Lithuanian Railways completes corporate reform

Lithuanian Railways has completed the corporate reform. The state-owned holding incorporated a separate infrastructure company instead of the specialised division. Earlier, there have been established two companies for operations. One is dedicated to freight service, another is responsible for passenger connections.

In early December a rail infrastructure manager has been incorporated as a separate company within the state-owned holding Lithuanian Railways (Lietuvos geležinkeliai, LG). The new entity was named Lietuvos geležinkelių infrastruktūra (Lithuanian Railways Infrastructure), the abbreviated title is LG Infrastruktūra. It is responsible for the maintenance and modernisation of the railway tracks and other infrastructure in Lithuania. Earlier, these functions have been provided by a specialised division (directorate) of Lietuvos geležinkeliai. “The incorporation of this company means that we have successfully and timely implemented an important program of structural changes in LG,” said Mantas Bartuška, CEO of Lithuanian Railways.

Fourth Railway Package

LG’s corporate transformation is being performed within the implementation of the Fourth Railway Package. In December 2018 Lithuanian Parliament (Seimas) approved state programme known as LG Keičiasi (‘LG is being changed’ in Lithuanian) and aimed at introducing a new corporate model in the state-owned railway company. According to the decision, Lithuanian Railways must be split into three separate companies, each of them will have its own area of responsibility: freight and passenger operations as well as maintenance of rail infrastructure.

On 1st May LG Cargo was incorporated for providing freight operations. Four months later, LG Keleiviams was established. LG Infrastruktūra is the last company established within the new model. After the reorganisation, three new companies are owned by the holding company Lietuvos Geležinkeliai. The latter is controlled by the Ministry of Transport and Communications of Lithuania. It is worth to note that Estonia and Latvia, the neighbouring countries in the Baltics, have reorganised their railway companies in the late 2000s.

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Author: Mykola Zasiadko

Mykola Zasiadko is editor of online trade magazines RailTech.com and RailFreight.com.

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