Full speed ahead for privatizations

The state privatization fund (TAIPED) is racing full throttle into the first quarter of the new year, having already chosen which state assets should be the first to go.

The sale of the Public Gas Corporation (DEPA), the Hellenic Gas Transmission System Operator (DESFA), Hellenic Defense Systems (EAS), the Greek Organization for Horse Racing (ODIE), the LARCO mining and metallurgical company and a small number of real estate properties are the most likely to see invitations for expressions of interest in the next one to three months, according to TAIPED officials.

The same sources argue that the outcome of the new privatizations being prepared, as well as those already under way, such as the state lotteries and the former airport at Elliniko, depend primarily on economic developments in Europe and to a lesser extent on the climate in Greece. A key condition will be the successful completion of the new private sector involvement (PSI+) plan, a well-informed official noted.

TAIPED is also preparing for other longer-term sell-offs, such as the extension of concession contracts for the major road projects around the country, for which a solution is being sought via negotiations with the contractors. TAIPED?s administration appears upbeat on the issue but hasn?t revealed any details.

Furthermore, the fund has not ruled out the reopening of negotiations for the extension to the concession contract for Athens International Airport in the first half of 2012, especially if a series of uncertainties affecting the country are lifted.

In the first quarter of the year, EAS and LARCO will likely set a pattern for a different model of approach to the privatization program. In that model the cashing-in character will be put aside for the benefit of the development of the asset on sale. Therefore, the decisive factor will be the development dimension of the property rather than the price.

Sources suggest that the market can expect invitations for expressions of interest in EAS and LARCO within February, while DEPA and DESFA are at a more advanced stage and will be discussed tomorrow at the TAIPED board meeting.

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