The Council for Privatisation & Capital Projects has cancelled plans to sell stakes in national rail freight operator Montecargo and port operator Luka Bar to Poland’s OT Logistics Group.

The tender commission believed that while sole bidder OT Logistics was a credible investor and the process had been conducted transparently and in accordance with regulations, privatisation would not be in the best economic, social and security interest of the country. In particular, it was felt that the ongoing modernisation of the railway to Serbia and improvements to road links would increase the value of the port of Bar as one of the country’s strategic resources.

OT Logistics said it would seek an explanation of the ‘completely incomprehensible’ decision, which was announced on April 24. According to the terms of the planned agreement, the company was expected to pay €2·5m for a 51% stake in Montecargo and €8·5m for a 30% stake in Luka Bar. It would also commit to investing €17·5m in modernising the two businesses.

‘The decision of the new government of Montenegro is a surprise to us, especially in the context of full transparency of the privatisation process,’ said CEO Zbigniew Nowik on April 25. ‘Negotiations had been successfully completed in March and we had not received any signals as to a possibility of cancelling the tender. We are currently investigating the matter and will inform the market about any new developments upon receiving more comprehensive information from our partners in Montenegro.’