Brussels raises obstacles to sell-offs

All of Greece?s privatization projects are facing problems, except for that of the public stake in Hellenic Petroleum, the government and the European Commission concluded on Tuesday at a meeting in Athens.

The meeting came ahead of the start of the process to sell off the OPAP gaming company, which gets under way on Wednesday.

Furthermore, the government has canceled the privatization of Hellenic Defense Systems (EAS), citing national security issues.

That is why Environment Minister Giorgos Papaconstantinou was very reserved at a briefing in Helsinki on Tuesday, during which he referred only to ?positive indications? regarding state asset sales, which involve the gas, petroleum and gaming sectors, as well as airports, among others.

Even the sell-off process for the Public Gas Corporation (DEPA), which has already started, could run into problems, as the utility has received state support that the Commission sees as distorting competition. This is also the main obstacle for OPAP as well as most other state-owned firms up for sale.

Papaconstantinou declined to name the companies interested in DEPA. Expressions of interest for the Public Gas Corporation and gas grid operator DESFA are due on Friday after the deadline was extended by a week.

The sale of state horse racing corporation ODIE has already met with resistance from the Commission as Brussels does not agree with the splitting of the company into two (its betting section and real estate properties) and is insisting it should be sold as one entity. The Larco mining and metallurgical company, on the other hand, will be allowed to be split for sale.

The board of Greece?s privatization fund (TAIPED) will meet today to discuss the procedure for OPAP. It is highly likely that TAIPED will approve the sale of the 29 percent stake provided by the new memorandum Athens has signed with its official creditors.

The question now is whether the fund will invite bids for the stake in the coming days or leave it on the back burner in an effort to avoid the wrath of Brussels regarding state subsidies. However, TAIPED officials said this week that bids will be invited as soon as possible because there is no time to waste. Any objections from Brussels would be taken into account in the second phase of the tender, involving binding offers.

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