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Newsletter July 2010


Investment Opportunities in State Assets

The Greek government is planning a major privatisation programme that offers investors significant investment opportunities.

On June 2 the government reiterated its invitation to foreign and domestic groups to invest in the country through an ambitious programme of privatisations, flotations, and the selling of public real estate assets, aimed at collecting three billion Euros in the next three years.

The sum, in fact, is cited in a memorandum signed between the Greek state, the EU and the IMF.

In a joint press conference, the Ministers of Finance, George Papaconstantinou; Infrastructure and Transports Dimitris Reppas; Environment, Energy and Climate Change Tina Birbili; and Tourism and Culture Pavlos Geroulanos announced the government’s decision to speed up procedures to exploit the country’s assets with the aim to achieve economic restructuring and growth.

Assets available to investors are in the sectors of transport (Hellenic Railways, ports, airports), water and sewage (Athens Water, Thessaloniki Water), energy (PPC, Hellenic Petroleum), telecommunications (OTE), gaming (OPAP, casinos), project concessions and real estate (Olympic projects, tourism assets).

A priority for this year is Hellenic Railways (OSE) and gaming, and other assets will be examined depending on market conditions.

Regarding Hellenic Telecoms (OTE), the government plans to change its board and then discuss any plans for an additional equity sale to Deutsche Telekom.

On OPAP, the government does not plan to reduce its equity stake in the organisation, and regarding PPC the state will maintain its 51 percent controlling stake.

Regarding debt-ridden Hellenic Railways, the state plans to sell 49 percent of TRAINOSE—the operator of railways—to strategic investors, along with management control. Cancelling loss-making lines, restructuring of its personnel base, and efficient management of the rail provider's real estate assets is also foreseen. The government also plans to seperate cargo from passenger operations.

On the ports of Piraeus and Thessaloniki (the state has a 74 percent controlling stake in each organisation) and 10 regional ports, the aim is to create one or more expanded corporate entities, followed by strategic partners, and then a listing on the stock exchange with the state holding at least 51 percent.

For the Athens International Airport the government will seek expansion of a concession contract and to list the company’s shares on the stock exchange. Regional airports will be operated with concession contracts to strategic investors.

The government will sell a 23 percent equity stake in the Thessaloniki Water Company and a 10 percent stake in the Athens Water Company; a holding company will be set up including all water companies in Greece.

The government will sell a 39 percent equity stake in Hellenic Post and for the Public Power Corp. (the state owns 51 percent) the government plans regulatory interventions to open up the wholesale and retail energy markets. The government will maintain an existing strategic participation in Hellenic Petroleum and Hellenic Telecoms.

All state-owned casinos will be sold and a plan was unveiled to merge all real estate companies owned by the state.