Dubai: Citadel Capital, a Middle East and Africa focused private equity firm with $8.3 billion (Dh30 billion) in investments under management, announced Tuesday that it has signed a right-of-way agreement with the Sudanese Railway Corporation, the first step in fledgling rail operator Nile Valley Railways' entry into the promising Sudanese market.

"This agreement will allow Nile Valley Railways (NVR) to proceed with the purchase of rolling stock, including wagons and locomotives, that will run on existing infrastructure in which the Sudanese Rail Corporation is making substantial investments," said Karim Sadek, Managing Director at Citadel Capital in a statement yesterday.

The agreement, on which due diligence is being fin-alised, will allow Nile Valley Railways to offer cargo transport services on Sudanese Railway Corporation's rail lines under a revenue-sharing agreement.

Key links

Sudanese Railway Corporation operates more than 4,500 kilometres of track linking the key coastal city of Port Sudan to Khartoum, Wadi Helfa on the Egyptian border to South Sudan.

A rehabilitated line that reopened just last week now links Babanusa in central Sudan with the southern town of Wau.

The Sudanese agreement is just the latest development to arise from Citadel Capital's focus on rail investments in Africa.

Earlier this month, the firm announced the acquisition of a 49 per cent stake in Sheltam Railways, which is the largest shareholder and lead investor in Rift Valley Railways (RVRI) of Kenya-Uganda.

RVRI holds a 25-year concession to operate some 2,000 kilometres of track linking the port of Mombasa with the interiors of both Uganda and Kenya. "Nile Valley Railways will grow in lock-step with Sudan's considerable export potential," said Sadek.

"This is an exciting greenfield venture, and we remain open to further investment both in Sudan's transport sector and further afield in Africa."

Other ventures

Citadel Capital's other investments in Sudan include Nile Logistics, which operates Keer Marine, a unique river-transportation venture, as well as investments in the financial services, cement production, agribusiness and mining sectors.

Citadel Capital is among the leading Arab investors in Sudan, where it will operate more than $900 million worth of investments by the end of 2010.