Investment funds interested in first generation of transportation entrepreneurs

The five biggest Romanian transportation companies, which together own an over 2,500-lorry fleet, post around 200 million euros in overall business, and have over 3,000 employees. A market dominated by family businesses has become attractive for investment funds, with the first majority stake in a top-ranking transportation company being sold this month by Mihai Dug`e[escu, Dumagas founder, a business that started by "carrying yellow Shell containers".

According to market sources, Dug`e[escu sold 60% in Dumagas transportation company to Bancroft, a private equity fund which is not at its first acquisition in Romania, and which previously held a stake in Mobifon, currently Vodafone.

The transaction reveals the growing interest for this sector dominated by family businesses, which often started outside Bucharest with two or three transportation vehicles. The first investment fund that noticed the potential of this market was Balkan Accession Fund (BAF), managed by Horia Manda, which took over a minority stake in transportation company Edy International Spedition in 2005.

The over 2,500 lorries of the top five Romanian transportation companies are worth around 100 million euros, considering an average price of 40,000 euros for a 2-4 year-old lorry.