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Privatisation comes to the fore

29 December 2012 / 13:12:37  GRReporter
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The privatisation programme, especially for companies like the Greek state lottery, the State Gas Company and the State Oil Company, will be crucial for the future of the country. If some 2.6 billion euro are not raised, as planned, by September 2013, new painful steps will be taken. That is why the programme is so important, especially in terms of revenues, because, if not implemented, this will lead to a new memorandum before the end of the year.

The Privatisation Agency, based on the agreement with creditors, expects revenues amounting to 2.3 billion euro from the sale of shares in state companies, and a further 300 million euro from real estate. The sale of 34.5% of the Greek state lottery, the privatisation of the Gas Company and its subsidiary for gas network management, as well as the sale of a 35.5% stake in the Oil Company, will play a major role in revenue collection. If this does not happen, the target for 2013 will not be even approximately achieved and the difference cannot be covered by other revenues. The remaining 300 million euro are expected from the sales of six major pieces of real estate abroad and the second part of the amount for the International Centre for Radio and Television. A positive development for the sale of real estate on the island of Corfu and Rhodes is also expected.

Privatisation contracts should be signed under approximately the same conditions as those of 2012. This year, only 100 million euro have been raised from privatisation. Lack of bank financing makes it difficult to find capital investments following the privatisation of companies. Uncertainty still scares private investors, who plan long-term investment in the country. Lengthy negotiations on the last major instalment have affected privatisation as well. The fourteen holdings that competed for the Gas Company formed unions in order to have greater financial power. In the second half of the year, the Privatisation Agency struggled to keep alive the interest in the Greek privatisation programme, at a time when it seemed that interested parties were withdrawing because of Greece's likely exit from the Eurozone. Political reaction is another big problem. A typical example includes the competition for the sale of 70% of Thessaloniki Water Company, which was postponed to the beginning of 2013 because the financial committee in Parliament could not set a date to discuss it.

On 9 January 2013, the Management Board of the Privatisation Agency will meet in order to speed up the procedures for the final phase of the competition for the Greek state lottery and the Gas Company. Documents for the next phase will be sent to the concerned parties by 15 February.  The decision forvalue throughout the country, most of which today house various government departments - tax offices, ministries, police stations.

In the first quarter of 2013, a development is expected on the privatisation of several state-owned companies:

- Former International Centre for Radio and Television in Maroussi

- Privatization of the state owned horse racing company

- Privatisation of the two major water companies in Athens and Thessaloniki, of which the state owns more than 70%

- Sale of 51.4% of the State Mining and Metallurgical Company

- Sale of 71% of the State Car Company

- Granting concession of use and exploitation rights over South Kavala Underground Gas Storage

- Sale of 90% of the Greek Posts

- Initiation of a procedure for the assessment of the state share in the Mining and Steel Company in the first quarter of 2013

- Competitions for regional airports in the first quarter, in order for their management to be transferred into private hands

- Competitions for regional ports

- Privatisation of the ports of Piraeus and Thessaloniki

The Privatisation Agency is in negotiations with potential investors for the old airport in Athens. Meetings in Qatar and Tel Aviv have already been held, and a meeting in London is also expected, as well as further steps. A privatisation Agency is also negotiating with the Greek company Lamda Development of the Latsis Holding, which has also expressed interest, although it is not known whether it is possible to financially support such a great investment.

Tags: privatisation the Greek state lottery oil company gas company Privatisation Agency
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