Spain: After more than a year, the sale of Talgo has come to an end. In the mid-February, a consortium made up of the steel company Sidenor and Basque government and financial organisations agreed to purchase 29.77% of the shares from the Trilantic investment foundation. No deals with any other market players are now expected.
The consortium has submitted its proposal to pay €4.15 per share to the Spanish National Securities Market Commission CNMV. If Talgo achieves certain financial indicators in 2027 and 2028, the price can be increased to €4.8, which would value 29.77% of the shares at €184.4 mln, instead of €153 mln.
Shortly before, Jupiter Wagons, one of India’s largest freight car manufacturers, and PFR, a Polish state fund that owns another rolling stock manufacturer, Pesa, had abandoned the idea of buying a stake in Talgo. The latter also ruled out taking a minority stake in Talgo once it had been taken over by Sidenor.
History of sale
It started in the autumn of 2023. The first proposal to buy 100% of the shares for €5 per share came from a Hungarian consortium of Ganz-MaVag and the state foundation Corvinus. The CNMV approved the deal, but the Spanish government blocked it, saying that approval would pose “insurmountable risks to national security”. Spanish officials had said on several occasions that the company, which is of strategic importance to the country, could not be sold to foreign parties. Following the Ganz-MaVag’s merger proposal, Škoda Group made a similar offer, which was rejected.
Then came proposals from India and Poland. Both Jupiter Wagons and PFR were interested in the deal because it would allow them to acquire competences in the production of high-speed trains and their components. Last year, India has placed an order for the development of high-speed trains with a design speed of 250 km/h, while implementing the high-speed Mumbai–Ahmedabad line project.
Poland, at the same time, is considering buying between 100 and 200 trains with a speed of 250 km/h for its ambitious project Central Transport Hub. While the local car builders do not produce the necessary rolling stock, Pesa and Talgo announced last year that they would cooperate in the construction of high-speed trains.
Talgo today
The last financial statements published by the company were for the 9 months of 2024. They show revenues of €497.8 mln, or +5.8% compared to the same period in 2023. Due to high expenses, the net profit was only €6.7 mln. The backlog of orders fell slightly from €4.2 bln to €4 bln. New orders, including that for Egypt, amount to €508 mln, while in the same period of 2023, Talgo received orders worth €1.9 bln and boasted a record year-end inflow.
Founded in 1942, Talgo specialises in high-speed and push-pull trains, including electric locomotives and coaches. For more than 10 years, the company has been developing the Vittal commuter and regional trains. It has invented a unique single-axle bogie for passenger coaches, but this strength makes it weak in term of operation and maintenance issues.
Talgo has two production facilities in Rivabellosa and Las Matas, Spain, and branches in the USA, Saudi Arabia, Uzbekistan, India, UK, Germany, Denmark, Kazakhstan, China and Egypt.
Last year, Spain witnessed the launch of Talgo’s new generation of high-speed trains, the Avril. These are the world’s first variable gauge trains with a maximum speed of 330 km/h. But the trains proved unreliable from the start. Added to the delays in delivery, Renfe, the company that operates them, is seeking to recover €166 mln in court. According to the Spanish media, this fine will not be cancelled after the purchase of the company’s shares.
