The finance ministry has advised the main power utility PPC to improve its profit margins and cut operational costs in a preliminary report concerning the utility’s strategic direction and forwarded to Greece’s new privatization superfund (EESYP), expected to start operating at the beginning of 2018.
The finance ministry’s preliminary report on PPC also calls for the utility to focus on offering modern services and utilize interconnections and modern technologies.
A total of 17 state utilities, including 34 percent of PPC held by the Greek State, will be transferred to the Public Holding Company (EDIS), to serve as a subsidiary of the new EESYP superfund. These utilities will be subject to the demands of the EDIS holding company, whose role will be to seek ways of improving utility performances as an effort to prevent their privatizations.
The Greek State’s other 17 percent of PPC is already controlled by TAIPED, the existing state privatization fund being incorporated into the overall structure of the new superfund.
The finance ministry’s proposals are expected to be fine-tuned in November and December, when the privatization fund establishes its strategic plans for each of the 17 state utilities.
The recommendations included in the preliminary PPC report, forwarded to the privatization fund by finance minister Euclid Tsakalotos, call for net profit margin and operating profit improvements through better capital management, as well as a reduction in operating costs.
All utility boards, including that of PPC, will be appraised based on the performances of their respective utilities, before new strategic plans are set.
All utilities transferred to the EDIS fund will be obligated to meet specific targets. These will become known early next year, once the superfund has been launched.