WINDHOEK (Reuters) – Cash-strapped Namibian rail operator TransNamib on Tuesday auctioned some of its assets in a bid to raise about 40 million rand to fund daily operations.
On offer at Tuesday’s auction were some of TransNamib’s offices, plots, flats and a farm. The company has a property portfolio valued at 2.4 billion rand ($143 million) dotted across the country.
State-owned TransNamib, which says it is bleeding around 10 million rand each month, has been forced to auction off some of its properties after struggling to get a capital injection from its shareholders and failing to raise funds on the market.
TransNamib spokesperson Abigail Raubenheimer said the auction sought to raise revenue to fund the rail operator’s business plan.
“It forms part of the directive we got from Cabinet in 2018 to sell some of our non-core properties off to fund our business plan,” she said.
The rail operator, struggling with ageing rail infrastructure and rolling stock, chronic corruption and infighting between the executives and the company’s board, has suffered 200 accidents in the past five years, according to state-owned daily New Era and a Reuters tally.
TransNamib CEO Johny Smith recently told state media that the company’s wage bill accounts for 71% of its total annual income.
Most of its employees are currently on strike after wage increase negotiations reached a deadlock, with the company saying it has no funds to afford any salary increment.
($1 = 16.8113 rand)
(Reporting by Nyasha Nyaungwa; Editing by Bhargav Acharya and Angus MacSwan)