Fairfax entry boosts Mytilineos Group’s investment options

Last week’s deal between Canadian firm Fairfax Financial Holdings and the Mytilineos Group for the former’s acquisition of 4.253 percent of the latter for 25.5 million euros represents another positive signal regarding the prospects of Greece’s economy.

The firm run by billionaire Prem Watsa already controlled 1 percent of Mytilineos, which has now climbed to over 5 percent, making Fairfax the third-biggest stakeholder in the Greek energy and mining group after Evangelos and Yiannis Mytilineos.

The deal is expected to bring about a more active participation by the Canadian fund in Mytilineos, combined with possible moves toward Eurobank Properties, in which Fairfax has acquired a controlling stake. This is also evident from the decisions for the placement of a senior Fairfax official on the governing board of Mytilineos and that of a Mytilineos Group official at Eurobank Properties.

On the day the deal was announced, last Friday, Fairfax also revealed it will raise its stake in Eurobank Properties from 19 to 41 percent. On Saturday, state sell-off fund TAIPED announced that the package of 28 public buildings set aside for sale and leaseback will be split between Eurobank Properties and Pangaia, a National Bank subsidiary.

After the deal with Fairfax the Mytilineos Group, which is active in strategic sectors of the local market, will obtain a very strong ally, allowing it to plan investment moves for the future that make the most of the opportunities arising through Greece’s privatizations process.

Mytilineos took part in the tender for the privatization of the Public Gas Corporation (DEPA) in a joint bid with the Vardinoyiannis Group. It has not denied its interest in the Public Power Corporation and the sale of its plants when they become available, or in the Larco mining company – provided the issue concerning the cost of electricity is resolved. Group sources stress the significance of the Canadian investment fund’s entry at this crucial point given the options it creates for future investment moves.

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