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Greece asks sole bidder COSCO to improve bid in Piraeus port privatization

Xinhua, January 13, 2016 Adjust font size:

Greece on Tuesday opened the financial offers for the privatization of its Piraeus port and asked China Ocean Shipping (Group) Company (COSCO), the sole final bidder, for a better offer by next week, the country's privatization fund announced.

The Hellenic Republic Asset Development Fund (HRADF)'s board of directors held a meeting to open the binding offers for the acquisition of 67 percent of Piraeus Port Authority (PPA) shares. Only COSCO had submitted a bid, according to an HRADF press release.

"Under the terms of the tender, an improved offer was requested to be submitted in coming days to be examined in the board's next meeting that is scheduled for next week," the terse announcement concluded.

During Tuesday's meeting, the HRADF board of directors also made public independent experts' appraisals commissioned by the fund. Although no numbers were revealed, Greek Maritime Ministry sources had told Greek national news agency AMNA that the current market value of the PPA was estimated at around 250 million euros (272.5 million U.S. dollars).

Under the terms of the tender which was launched in 2014, the buyer was required to make investments worth approximately 340 million euros (370.6 million U.S. dollars) in the port within the next five years.

Should the deal be finalized, COSCO will control 51 percent of the stake for PPA in the first phase and the rest of the shares in five years.

According to AMNA, the Danish Maersk Group, which was among other candidate investors for Piraeus port in previous months, has shifted their interest in the sale of the northern Greek port of Thessaloniki.

Since 2009, COSCO's subsidiary Piraeus Container Terminal (PCT) has been managing Piers II and III at Greece's largest port under a 35-year concession agreement, while PPA today runs Pier I.

COSCO's vision to turn Piraeus into a leading international transit hub for products and services from Asia to Europe has already attracted other major multinationals at the port, which are cooperating with PCT to distribute their products in the region.

Piraeus port privatization is also viewed by local and foreign officials and analysts as a significant boost to the overall progress of the country's privatization program.

The 50-billion-euro privatization program launched in 2010 as part of efforts to overcome the Greek debt crisis and support growth has suffered several delays, but over the past months progress has been made.

In December 2015, Greece finalized the privatization of 14 regional airports and the sale of the Astir Palace seaside resort in Athens. Greek officials have said that they expect to raise about 2.5 billion euros (2.7 billion U.S. dollars) from privatization in 2016. Endi