Bailout pushing ahead difficult PPC, ELPE, DEPA privatizations

Additional terms in the revised bailout demand the announcements of tenders by this coming March for the sale of DEPA, the Public Gas Corporation (65%), ELPE, Hellenic Petroleum (35%), and, in June, PPC, the main power utility (17%).

Never before have such challenging privatizations, both politically and technically, been placed under so much time-related pressure.

The government and country’s lenders are examining the prospect of a convertible bond issue as a result of PPC’s current low bourse value. The 2018 national budget foresees 100 million euros in revenues from the sale of PPC’s 17 percent.

The bailout-required sale of PPC lignite units (Meliti I, Megalopoli III and IV), a construction permit for Meliti II, as well as mines, is also planned to take place in June.

The complexities involved in the overall process concerning two concurrent sale plans make the PPC plan seem like a theoretical prospect for the time being. Furthermore, Genop, PPC’s main union group, can be expected to do its utmost to obstruct both bailout-required sale plans. Strikes, facility occupations, as well as legal action, have  already been promised to coincide with the tabling of a bill to parliament for ratification of the unit sales, expected around March.

Similarly to PPC, the bailout’s ELPE sale conditions note that a stake of less than 35 percent may be offered to investors as long as it produces the equivalent amount of revenues for the Greek State. Paneuropean, a member of the Latsis corporate group, is ELPE’s main shareholder with a 45.47 percent share stake.

The bailout’s scheduling of the DEPA sale plan is also extremely tight. The tender’s announcement this coming March coincides with a deadline faced by the now-dominant gas utility for settlement of its future role in Greece’s gas market.

By March, DEPA needs to have reached agreements with Shell and ENI, its respective partners in the EPA Attiki and EPA Thessaly-Thessaloniki gas supply firms. Both Shell and ENI hold respective 49 percent stakes in these ventures. More importantly, any deals struck between DEPA, Shell and ENI will require Competition Committee approval.