It seems that international investors in the Russian rail operator Globaltrans will no longer be getting their dividends. The company stops abiding by its dividend policy, because sanctions are making it impossible to pay them out.
According to a press release, Globaltrans’ council of directors decided to cancel its dividend policy due to “technical difficulties”.
“In light of the continuing technical difficulties and various limitations on financial infrastructure, the company sees no opportunity to renew regular dividend payments to all investors in all jurisdictions in the foreseeable future.” In other words, Globaltrans does not have the ability to make dividend payments internationally.
The company tried relocating some of its operations from Cyprus to Abu Dhabi in order to continue dividend payments, among other reasons, says the Moscow Times. It seems that the move has been to no avail.
No investments in rolling stock either
Moreover, Globaltrans said that it was suspending investments into rolling stock for the time being. Their prices are high in Russia, which makes it unattractive for companies to expand their rolling stock fleet. Rather, companies may look to consolidate the market by buying up their competitors, Russian publication Kommersant writes.