Foreign bank, SGCC positions unclear in IPTO sale plan scare

A threat that came close to derailing the government’s split-and-sale plan for IPTO, the power grid operator, a subsidiary of PPC, the main power utility, last Friday night, following concerns raised by the country’s four main banks over financial guarantees, now appears to be under control, but questions still linger.

The four banks reached an agreement with the government after deeming that the fulfillment of three guarantees set on Friday would not require the banks to block the IPTO split-and-sale procedure.

According to energypress sources, the four banks will be granted PPC contracts that promise to generate future cash flow; PPC loans will be transferred to IPTO’s SPV (Special Purpose Vehicle); and amounts owed by the Greek State to PPC will be swiftly settled in order to enable the utility to service its bank loans.

It is not yet clear whether other PPC creditors, including the European Investment Bank and funds, are satisfied with the agreement reached between the government and the country’s four main banks.

It is also unclear to what degree these guarantees set by the four main banks impact the 320 million-euro price tag of SGCC’s (State Grid Corporation of China) agreement with PPC for the acquisition of a 24 percent stake of IPTO.

The interest will now focus to PPC’s general shareholders meeting scheduled for tomorrow. Facing a tight schedule, set as part of the bailout, the government’s IPTO split-and-sale plan has developed into a more complicated project than originally anticipated.

The government’s plan entails keeping 51 percent of IPTO under the Greek State’s control. If the country’s creditors deem that the procedure is not progressing as planned, PPC will be forced to sell IPTO in its entirety.