Ups and downs of state sell-offs

The government’s vacillation on the sale of state-owned companies has never been more evident than in yesterday’s announcement of a further delay in the sell-off of national flag carrier Olympic Airways, offsetting the news that the Greek post office ELTA and the Piraeus Port are firmly headed for the private sector. The government, which was due to announce the results of negotiations with bidding consortium Integrated Airline Solutions (IAS) yesterday, is now expected to reach a decision on February 4, government spokesman Christos Protopappas told reporters yesterday. He did not specify any reason for the delay. «The State’s objective is to come up with a solution that will not burden the Greek people and will, at the same time, facilitate the viability of the airline,» he said. He said the government was «exhaustively» reviewing all the possibilities and that it was not advisable to stick to datelines. «The government guarantees that an appropriate solution will be found,» Protopappas stressed. Greece’s attempts to sell off the airline have been a huge struggle from the start, with the company handicapped by massive debts, a bloated workforce, an aging fleet and militant unions. Even as government officials privately admit that the company is essentially bankrupt and has no future, in public they have asserted that Greece will definitely have its own carrier for the 2004 Olympic Games. The government initiated talks with IAS, a consortium backed by Olympic pilots, prominent Greek businessmen and Quantas executives, last November after preferred bidder Axon Airlines suspended its operations. Making up for the bad news on Olympic Airways, the Economy and Finance Ministry said yesterday that the privatization of ELTA and the Piraeus Port are going ahead, though on a smaller scale for the post office. The State plans to offer 10 percent of ELTA, down from an initial target of 25 percent, and 50 percent of the post office’s courier subsidiary to a strategic investor. The three shortlisted candidates – Deutsche Post, the Netherlands’s TPG and La Poste of France – have until March 8 to submit binding bids. ELTA is also scheduled to float on the Athens Stock Exchange within the year. In the meantime, the Piraeus Port has finalized preparations for a listing and plans to submit an application to bourse authorities by February 19. The Merchant Marine Ministry said 25.5 percent of the port, equivalent to 6.375 million shares, would be offered to investors, of which 303,000 shares will go toward a private placement.