The National Bank of Greece and Goldman Sachs have been hired by TAIPED, the State Privatization Fund, to determine strategic options concerning the future utilization of the Greek State’s 35.47 stake in ELPE (Hellenic Petroleum).
The consultants will need at least six months tp clarify the picture surrouding the prospective privatization, which would represent one of Greece’s biggest. The Greek government firmly opposes the plan, it is believed.
The overall process promises to be extremely complex, if not messsy, and politically sensitive. The corporate make-up of ELPE, Greece’s biggest petroleum group with the Greek State as a steady stakeholder over the years, also includes Paneuropean, a member of the Latsis group, holding a 45.47 percent stake and possessing the right to make the first offer should the ELPE privatization proceed.
Making matters even more complicated, ELPE holds 35 percent stakes in DESFA, the natural gas grid operator, and DEPA, the Public Gas Corporation.
The consultants plan to break up their task into two stages. The first, expected to require six months, will focus on how the Greek State’s 35.47 percent stake in ELPE can be best utlized. Then, over an ensuing 24-month period, the consultants will examine whether Paneuropean or other investors may be interested in acquiring the Greek State’s ELPE stake.
Though the government has refrained from speaking out on ELPE’s future, it is firmly believed that many government officials oppose this privatization plan. These government critics view ELPE as an iconic enterprise that is currently enjoying one of the most prosperous periods in the company’s history, as highlighted by a series of record-breaking performances generating revenues for the Greek State.
The government officials opposing the privatization also believe ELPE is pivotal to the local hydrocarbon sector, offering huge potential and, therefore, making unnecessary any need for the Greek State to give up part, or all, of its stake in the petroleum company.
Energy minister Giorgos Stathakis has firmly opposed any sale of the Greek State’s share in ELPE. He would prefer to see this stake, now controlled by TAIPED, the privatization fund, transferred to the Public Holding Company (EDIS), which, along with TAIPED, is planned to serve as a subsidiary of the new EESYP superfund. The EDIS holding company, whose role will be to seek ways of improving utility performances as an effort to prevent their privatizations, could then appraise ELPE over the long term, in connection with the Greek economy’s anticipated recovery, the minister believes.
An ambitious annual privatization revenues target of two billion euros set by the lenders can only be achieved through the sale of the Greek State’s stakes in major listed enterprises such as OTE (Hellenic Telecommunications Organization), ELPE, DEPA and Athens International Airport.
Privatization figures will represent a key factor in Debt Sustainability Analysis studies to be carried out by the institutions monitoring the Greek bailout program (ESM, IMF) in the lead-up to next summer as part of the effort to put an end to Greece’s bailout program. The energy ministry is well aware of these commitments.