IPTO plan can still be derailed by ‘dangerous curves’ ahead

Despite the fact that the Greek government and the country’s lenders, with guidance from independent consulting firms, are moving ahead with a plan established to split IPTO, the power grid operator, from the main power utility PPC and transfer stakes to the Greek state and private investors, certain critical issues – described to energypress by an official closely following developments as “dangerous bends on the road map laid out” – remain unresolved.

Two crucial details still need to be addressed. Firstly, the lenders need to reach a final conclusion as to whether the solution being planned is truly sustainable, which, it is anticipated, would lead to its endorsement at an upcoming euroworking group. Secondly, an agreement needs to be reached by Greece and its lenders on a realistic schedule, one that will not cause delays, which could prompt the retabling of thoughts, by the lenders, to privatize IPTO in its entirety.

Following their meeting earlier this week with the consulting firms hired for the matter – Lazard, Sol, and Norton – the country’s lenders now hold in their hands a virtually finalized proposal for IPTO.

Certain technical issues remain, ones primarily concerning taxation and accounting matters, to be further examined by the consulting firms. The country’s lenders are expected to have finalized proposals on these by tomorrow.

Then, the country’s lenders will need to decide on their final proposal by this coming Tuesday. If all goes well here, then the euroworking group’s decision on April 22 will be positive.

Greek officials expect this to be the most likely outcome, but nothing can be ruled out until the technical teams representing the lenders have fully analyzed the details of proposals made by the consulting firms. It should be noted that lender technical team representatives, who had been given the basic details of the consulting firm proposals when they met with Greek officials earlier this week, were in a constructive mood. No obstacles were reported, an encouraging sign that the plan will proceed.

Following euroworking group approval, the Greek government and lenders will, by the end of April, need to draft a final version of the agreement to take effect between the Greek State and lenders. Deadlines will be included in this text.

Negotiations on the procedure’s scheduling are expected to be tough. The lenders are expected to push for tight deadlines with the aim of getting as much done within 2016, or even finalizing the sale within 2016. According to sources, lenders have already asked for an official announcement of the IPTO sale to be made in June. On the other hand, the Greek government prefers a more relaxed schedule, which it believes is more realistic. This could mean launching the sale within 2016 without demanding binding offers in the current year.

PPC played an active role in the procedures leading to the proposals made by the consulting firms.

The IPTO plan, based on latest news, entails transferring a 51 percent share of the operator to the Greek State for a price to be paid to PPC, offering a network operator the right to acquire at least 20 percent, and placing the remainder on the bourse.