Greece delays asset sales as coronavirus impact hits prices

Lamda Development SA

06/05/2020 12:50

By Angeliki Koutantou
    ATHENS, May 6 (Reuters) - Greece will raise only a fraction
of what it initially expected from privatisations this year, as
the coronavirus downturn has forced it to put planned asset
sales on hold to avoid low offers.
    Athens expects privatisation revenues of between 350 million
and 400 million euros this year, the head of its privatisation
agency Aris Xenofos told Reuters on Wednesday, well below the
2.4 billion euros ($2.6 billion) it had originally targeted.
    Asset sales are important for Greece, which has been bailed
out three times and emerged from a decade-long debt crisis in
2018, as it seeks to attract investment to restart its economy
and lower public debt, one of the highest in the euro zone. 
    Greece expects to wrap up a long-delayed lease of its former
Athens airport site, known as the Hellenikon project, for 300
million euros by the end of the year as originally expected. 
    Plans to turn the sprawling, abandoned plot, which was the
site of Olympic venues in 2004, into one of Europe's biggest
tourist resort have been mired for years in bureaucracy.
    But it has decided to push back tenders launched for three
projects to avoid a lower valuation being put on the assets as a
result of market uncertainty and a global economic slowdown
triggered by the coronavirus crisis.
    Greece had hoped to get binding bids for a 30% stake in its
biggest airport, full control of gas network DEPA Infrastructure
and a majority stake in gas supplier DEPA Commercial. 
    "Right now there is a market risk which would be inevitably
reflected on the offers we would get," Xenofos said, adding that
social distancing measures are also getting in the way of the
process, which would normally involve site visits and meetings.
    "We wouldn't rush, for any reason, into actions that would
get us offers much lower than the prices we are aiming at."
    
    'GIVE IT MORE TIME'
    Lockdown measures Greece imposed to contain the spread of
the coronavirus grounded flights and froze economic activity,
turning expectations for strong growth upside down as Athens 
now projects a deep 4.7% to 8.9% recession this year. 
    Xenofos said there was no specific time frame for the bids 
in the airport project, as the agency reviewed the situation
month by month.
    Nine investors have qualified for the sale and the
submission of final offers was expected in the second quarter of
the year. urn:newsml:reuters.com:*:nL8N2A04A0
    Nine foreign investors have also expressed interest for DEPA
Infrastructure and another nine foreign and domestic investors
for DEPA Commercial  urn:newsml:reuters.com:*:nL8N2AL5B0  urn:newsml:reuters.com:*:nL8N2BG83Z. 
    The agency will announce which investors qualify for the
second stage of both asset sales by June, Xenofos said.
    The second stage includes site visits, due diligence and the
submission of binding bids by short-listed investors and would
normally take six to eight months. 
    "Interested investors are still hot ... for all the assets,"
he said. "We'll give it more time to get things back to normal".
($1 = 0.9256 euros) 

 (Reporting by Angeliki Koutantou;
Editing by Alexander Smith)
 ((angeliki.koutantou@thomsonreuters.com; +30 210 3376436;
Reuters Messaging: angeliki.koutantou.reuters.com@reuters.net))