UPDATE 1-Polish watchdog clears way for IPO of railway group PKP Cargo
(Adds banks involved in IPO)
WARSAW Oct 4 (Reuters) - Poland's market watchdog KNF on Friday approved the prospectus for the initial public offering of PKP Cargo, the European Union's second-largest railway goods carrier, in a flotation valued at some 500 million euros ($681 million).
The company is part of Poland's state railways carrier PKP, which plans to sell a minority stake in the unit to help it cut debt and finance infrastructure investments.
There had been a question market over the IPO, expected to be Warsaw's largest this year, before PKP Cargo's management reached a deal with unions on job guarantees in August.
The company's net profit nearly halved in the first six months of the year to 77 million zlotys ($25 million) on 2.3 billion in revenue. It's core profit (EBITDA), often used in company valuations, stood at 312 million zlotys.
PKP Cargo said Goldman Sachs, Morgan Stanley and PKO BP brokerage will be global co-ordinators and bookrunners for the offer.
Other institutions taking part in the flotation will be UniCredit, Raiffeisen Centrobank, Ipopema Securities and Polish brokerages Investors and Mercurius.
PKP Cargo will publish its IPO prospectus on Tuesday. ($1 = 3.0926 Polish zlotys) ($1 = 0.7340 euros) (Reporting by Chris Borowski and Pawel Bernat; editing by David Evans)