Croatian state-owned HŽ Cargo and Slovakia-based Railtrans International (RTI) signed a memorandum of understanding to establish a joint venture for intermodal freight transport. The partners aim to generate an additional annual freight volume of more than 500,000 tonnes between Croatia’s Adriatic ports and Central European markets by 2028.
The agreement, signed on 30 July, comes after more than a decade of unsuccessful attempts to secure a strategic partner for the state-owned freight operator. According to the companies, the initiative is intended to strengthen Croatia’s position as a key logistics gateway between the Adriatic and Central Europe, while creating new growth opportunities for HŽ Cargo and its partners.
“This Memorandum is the result of a process that we conducted responsibly, transparently and with a single objective – to secure the future of the national freight operator. We have chosen a model under which HŽ Cargo remains owned by the Republic of Croatia, while at the same time gaining what it has lacked most, access to the European market, international customers and a partner that knows our network better than anyone else,” said HŽ Cargo President Dragan Marčinko.
HŽ Cargo’s struggles
Following the liberalisation of Croatia’s rail freight market, HŽ Cargo steadily lost market share as new private operators entered the market. At the same time, the company faced mounting financial difficulties, excess staffing and an ageing fleet of locomotives and freight wagons. The Croatian government therefore sought a strategic partner that could provide fresh capital, modernise the rolling stock fleet and support the company’s international expansion.
The first privatisation attempt was launched in 2013, when the government offered a 75% stake in HŽ Cargo together with a capital injection. However, the process collapsed after the selected bidder, Romanian freight operator Grup Feroviar Român (GFR), failed to pay the agreed purchase price within the contractual deadline, while disagreements also emerged over contractual obligations. The government terminated the negotiations at the end of 2014.
Joint venture over strategic partnership with RTI
A new search for a strategic partner officially began in February, 2023, when the Croatian government adopted a decision launching the process. Several European rail freight and logistics companies reportedly expressed interest. At one stage, Slovenia’s SŽ-Tovorni promet was widely regarded in local media as the leading candidate, but it ultimately withdrew from the process.
Unlike the other interested parties, Railtrans International did not seek to become HŽ Cargo’s strategic partner. Instead, it proposed from the outset the establishment of a joint venture focused exclusively on intermodal transport. With the strategic partner process failing to produce a shareholder transaction, this has now emerged as the only tangible form of cooperation.
Rail freight in Croatia
Rail freight volumes in Croatia totalled 14.7 million tonnes in 2024. HŽ Cargo accounted for 41.5% of the market, followed by ENNA Transport with 22.7%, Rail Cargo Carrier Croatia with 12.8%, SŽ-Tovorni promet with 6.8%, Transagent Rail with 5.5%, Train Hungary Magánvasút with 3.5%, Rail & Sea with 2.8%, Log Rail with 1.5%, InRail with 0.8%, while all other operators together accounted for the remaining 2.1%.
