Significant changes are expected to take place at Ukrainian Railways overnight on June 1.
“Ray AB Cafe is opening on board UZ’s high-speed trains instead of our good friends from WOG Cafe,” Oleksandr Shevchenko, Deputy Director of Passenger Communications at UZ, wrote in a Facebook post. This will be the final chord for WOG catering outside its gas station chain.
Railway hotdogs
WOG Cafe appeared on Intercity and Intercity+ trains in February 2016. At that time, the owners and management of the gas station chain were attempting to expand into other markets. A small WOG Cafe chain opened in Kyiv and Lviv in 2015, followed by retail outlets in Ukrainian airports and partnership with UZ. The company planned to rub a chain of over 200 cafes. But things didn’t go as planned.
In May 2019, WOG decided to close city cafes and focus on infrastructure facilities.
However, this model didn’t last long. The small-scale establishments were battered by COVID lockdowns, when Ukrainian airports were closed from March to June 2020, as well as Russia’s full-scale invasion in February 2022, when air travel was suspended entirely.
However, it was precisely because of the war that WOG continued serving food on UZ’s trains until now.
Almost all previous tenders for catering on trains were accompanied by conflicts and scandals. Maybe that’s why UZ maintained relations with WOG for quite a long time.
Read also: From Uzhhorod to Vienna: Ukraine paves way with European standard railway
Compulsory tender
In July 2023, the Antimonopoly Committee of Ukraine (AMCU) found that from February 2016 to June 30, 2023, Intercity and Intercity+ passenger catering services were provided exclusively by WOG Retail LLC and WOG Cafe LLC. Although the term of the contract, signed in February 2016, expired on Dec. 3 of the same year.
“However, Ukrainian Railways didn’t conduct a new tender, but continued contractual relations with WOG Retail LLC, permanently extending the contract,” the AMCU said in a statement. Because of this, the contract was voided only on June 30, 2021, the committee added.
After that, UZ and WOG Cafe signed an agency agreement, which was valid until June 30, 2023.
In 2019 and 2020, UZ tried to hold two tenders, but they either didn’t take place, or their results were canceled. The AMCU concluded that “UZ’s inaction created barriers to market entry for other business entities and gave advantages to WOG Cafe LLC.”
The AMCU recommended that the railway operator hold a new tender for catering in 16 trains. It took place in November 2023. Three bidders, including Saneko Retail, Ramedas Ukraine, and Pontem.UA, participated. The latter, owned by Lithuanian entrepreneur Irmantas Norkus offered the best price. But in the end, the company was disqualified due to non-compliance with certain technical requirements.
Another tender took place in late April 2024, which involved seven bidders, including WOG. But the winner again was Pontem.UA, which received the right to feed passengers of Ukraine’s high-speed trains for the next five years.
UZ said the initial price amounted to UAH 1,898 million ($46,929) (without VAT). The winning bid offered twice the starting price, or UAH 3,625 million ($89,630) (without VAT). UZ says they’ll retain the right to vet the product range and prices, as well as to monitor the quality of services through feedback.
Who’s Mr. Irmantas?
Pontem.UA is an international company that has been working on the Ukrainian market for eight years, has experience in serving meals for children, airline catering, etc. The Lithuanian wholesale retail company was founded in 1946, and they have about 25 years of experience in catering.
Baltijos paslaugų grupė (Lithuania) is the legal owner of the Ukrainian branch, while Irmantas Norkus is its beneficiary. The company participates in Ukrainian state and municipal tenders for school and hospital catering. According to the Clarity Project analytical system, Pontem.UA has won 345 tenders for a total amount of over UAH 1 billion ($24.7 million) since 2017. This year, the company applied for tenders to supply food to the Armed Forces of Ukraine, worth several billion hryvnias. However, these tenders didn’t take place.
The company already faced problems working in Ukraine before. In 2018, there were problems with nutrition in Kremenchuk hospitals, which was outsourced to Pontem.UA. Local media reported the problems concerned both the quality of the food and the safety of its preparation. The owner, Irmantas Norkus, arrived on site to solve the problem. He committed substantial resources to community outreach in Kremenchuk, hoping to mend his public image.
Will Pontem.UA be able to fully replace WOG Cafe and win the approval of Ukrainian train passengers?
The menu now has as many as 33 new items, Shevchenko said.
“In particular, croissants, children’s menu, fish lunch, vegan burgers, and chicken broth. Popular staples—hot dogs and cheesecakes—are still on the menu, no need to worry,” he added.
Read also: Plans unveiled for new gas power plants in Ukraine by Ukrainian Railways
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Read the original article on The New Voice of Ukraine
Section: Business
Author: Eric Malinowski
