Thessaloniki port privatisation in the home stretch

Thessaloniki port privatisation in the home stretch

The long drawn-out privatisation process of the Greece’s second port, Thessaloniki is now in the home stretch, though it appears the February 14 deadline for the submission of bids will be extended by about 20 days.

Sources have been telling the media the concession contract’s second review phase was completed before Christmas, but state privatisation fund, Taiped, has not completed the incorporation of review, but that within this month interested parties will receive the final draft of the contract. There will be a period of about one month for the submission of final binding offers thus the deadline will be put back to end-February or early March.

The state is selling its whole 65% stake in Thessaloniki in one go, though the original plan had been for the concession of 51% at first and the remaining 16% at a later date as was the case with the successful sell-off of Piraeus to Cosco Shipping completed last summer. The contract also provides for investments of EUR180m within seven years.

Considerable investor interest remains in the port’s prvatisation, as of the eight authorised participants in the bidding process, at least five remain active – Mitsui & Co, DP World, ICTSI, Deutsche Invest and GEK Terna. Chinese investors are also said to be closely watching developments while the Japanese interest is being actively promoted by Japan’s ambassador to Athens.

The Middle East interest has been confirmed by Stergios Pitsiorlas, deputy Finance minister. Greece is seen as acting as a bridge between the Arab world and Europe, and a springboard for growth in the broader region, strengthening both the Greek economy and the country’s role in Europe according to Tawfic Khoury of the Middle Eastern construction company, Consolidated Contractors Co.

The bidding process is set to move forward now that two crucial points have been smoothed out for investors. The first concerned the port’s assets as Prime Minister Alexis Tsipras had promised to give a chunk to the people of Thessaloniki, and the second was related to the minimum level of container handling.

As regards the minimum amount of containers handled, the target set now for the end of the first five-year period is not very different to today’s of about 360,000 teu per annum. Investors believe it is not feasible to set much higher targets, during a period of high investments by the preferred bidder and development of the port’s infrastructure.

  

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