The main power utility PPC’s low bourse value, which yesterday dropped to 445 million euros as a result of a sell-off by the Landsdowne Partners fund over the past few sessions, is a major concern for the government. Besides needing to sell 40 percent of PPC’s lignite capacity in 2018, a bailout requirement, the government must also sell a 17 percent stake of the utility now controlled by TAIPED, the state privatization fund. The Greek government holds a 34.12 pecent stake.

The challenge posed by PPC’s current low share price will be dealt with through a convertible bonds issue representing the utility’s 17 percent, the government and lenders have agreed, as an alternative plan, included in the bailout’s third review.

The convertible bonds issue process is planned to begin along with the PPC units sale offering 40 percent of the utility’s lignite capacity, expected to be launched in June. The bond issue process should be completed by the end of the year.

Privatization revenues for 2018 include 100 million euros forecast from the sale of PPC’s 17 percent. This amount will be greatly exceeded through the convertible bonds issue, assuming the 17 percent sale goes ahead.

As for the Greek State’s sale of its 35.5 percent stake in Hellenic Petroleum (ELPE), the bailout’s third-review agreement between the government and lenders promises to delay this privatization. The agreement includes a provision that enables officials to consider offering investors a stake less than 35.5 percent.

This could lead to a combined sale package including part of the 45.47 percent stake held by Paneuropean (Latsis group), ELPE’s main shareholder.

The objective is to examine a scenario that would secure a stake for the Greek State and also offer potential buyers a considerable share with managerial rights intact. Similar plans have been explored in the past, to no avail.

The ELPE sale is planned to deliver 500 million euros of privatization revenues in 2018.

The budget also foresees 250 million in 2018 from the DEPA (Public Gas Corporation) privatization.

Given the various circumstances and challenges, the overall amount of 850 million euros in privatization revenues forecast in 2018 from the PPC, ELPE and DEPA sales is highly unlikely to be achieved next year.