TAIPED is planning to securitize future revenues to boost coffers

The shortfall in revenues from privatizations in 2013 raises the target for next year to 4 billion euros, almost four times the amount expected to be collected by the end of this year. It appears obvious this target cannot be achieved by using the procedures followed to date and state sell-off fund TAIPED will need to resort to other measures to bring in more revenues.

The government and its creditors have already discussed the idea of securitizing future revenues from real estate properties. The question now is the number and form of those securities to be introduced into the market. TAIPED officials are hoping to present the first securities by early 2014.

It is quite encouraging that in the next few days the TAIPED coffers will be boosted by the collection of 622 million euros from the sale of a 33 percent stake in gaming company OPAP. The target of 1 billion euros will therefore be met, as 190 million euros for the 12-year lottery operation license has already been collected, plus some other smaller revenues.

TAIPED is now focusing on the sale and leaseback of the 28 state properties, a project that will effectively be second only to OPAP’s privatization. The sell-off fund originally anticipated revenues of 300 million euros, but has now lowered its expectations to 200-250 million. It has also reduced the properties’ monthly lease rate from 30 million euros to 25 million in total.

Sources say that TAIPED has offered candidate buyers returns of 10 percent from this privatization, but investors appear reluctant to agree to such a transaction and are seeking a higher yield. The main candidates for this project are Pangaia – a National Bank of Greece subsidiary – and Eurobank Properties.

Market experts argue that it is the sale of the 28 state properties that will determine the final amount of revenues for TAIPED this year. The submission of binding offers is scheduled for this Friday, provided there is no further extension.

The outcome of this procedure will also play a role in determining the revenues target for 2014, too, as anything that has not been completed in 2013 will be transferred to next year.