Greece to evaluate new Cosco bid for Piraeus Port on Jan. 20 (updated)

Icts International NV

18/01/2016 20:47

* China's Cosco sole bidder for the country's biggest port 
    * Greece has asked Cosco to improve its offer 
    * Privatisation agency meets Jan. 20 to evaluate new bid 
    * Deadline for Greek railways pushed back by a few weeks 
 
 (Adds quotes, more detail) 
    By Angeliki Koutantou 
    ATHENS, Jan 18 (Reuters) - Greece will evaluate on Wednesday 
an improved bid that China's Cosco  1919.HK  is due to submit 
for a majority stake in Piraeus Port  OLPr.AT , a senior 
official at the privatisation agency (HRADF) said on Monday. 
    Cosco was the sole bidder for a 67 percent stake Piraeus 
Port Authority (OLP), the manager of the country's biggest port 
which is a gateway to Asia, eastern Europe and north Africa. The 
agency has asked Cosco to improve its offer.  urn:newsml:reuters.com:*:nL8N14W440 
    "HRADF's board is scheduled to convene Wednesday evening to 
assess an improved offer that Cosco will have submitted by 
then," the official told Reuters on condition of anonymity. 
    The official said if Cosco's bid was not satisfactory the 
agency could ask the company to improve it further. The agency 
has the right to cancel the tender if it deems the offer is not 
satisfactory, under its competition rules. 
    "Negotiations with Cosco will continue until the last minute 
so that we achieve the best possible price," the official said. 
    Piraeus Port is valued at $367 million based on Monday's 
share price. A source close to the process said that Cosco has 
offered about $300 million for Piraeus Port, a premium of about 
22 percent, according to Reuters calculations. The company has 
until 1500 GMT on Wednesday to improve its bid. 
    The leftist government of Alexis Tsipras halted the sale of 
the port and other state assets after winning elections in 
January last year but resumed the process under a third bailout 
of up to 86 billion euros ($94 billion) agreed in August. 
     
    WORKERS AGAINST 
    Piraeus Port workers are against the sale because they fear 
it will lead to job cuts, while Greece's Shipping Minister 
Thodoris Dritsas has said having a sole bidder was not the best 
outcome one should expect. 
    OLP operates Piraeus Port under a concession agreement with 
the Greek state. The company's board decided last week by a 
majority to renegotiate the concession agreement, upon which 
Cosco based its offer. 
    The decision is not expected to affect the sale, which needs 
to be approved by OLP's shareholders, but is undermining the 
government's attempt to achieve the highest price possible for 
the port, the official said. 
    Denmark's container terminal operator APM Terminals 
 MAERSKb.CO  and Philippines-based International Container 
Terminal Services  ICT.PS  were also interested in the port but 
did not submit a bid. 
    Privatisations have a been a key part of Greek bailouts 
since 2010 but have not produced much money so far due to 
resistance from politicians and unions and bureaucratic delays. 
    The privatisation agency is expecting to raise two to three 
billion euros from state assets this year. That would be nearly 
double the figure projected in the 2016 budget but less than the 
3.7 billion euro target set in the latest bailout. 
    Greece has also pushed a Jan. 15 deadline back by a few 
weeks for the submission of binding bids for the railway company 
(TRAINOSE) and its maintenance operator (ROSCO), due to 
technicalities, the official said. 
    Russian Railways (RZD) and its Greek partner GEK-Terna 
Holdings  HRMr.AT , France's SNCF Participations and Romania's 
S.C. Grup Feroviar Roman were shortlisted for TRAINOSE in 2013. 
    An official close to the sale said RZD was still interested 
in TRAINOSE but the other two were less likely to bid. 
($1 = 0.9182 euros) 
 
 (Editing by David Clarke and David Evans) 
 ((angeliki.koutantou@thomsonreuters.com; +30 210 3376436; 
Reuters Messaging: angeliki.koutantou.reuters.com@reuters.net)) 
 
Keywords: GREECE PRIVATISATION/PORT