Government to hire adviser for Emporiki sale

The government will hire an adviser to sell its 9.5 percent stake in Emporiki Bank as part of its privatization agenda, hoping to woo strategic partner Credit Agricole, a senior Economy and Finance Ministry official said yesterday. (Economy and Finance Minister Giorgos Alogoskoufis confirmed the report after a meeting with Bank of Greece Governor Nicholas Garganas.) The government is targeting proceeds of 1.65 billion euros ($1.95 billion) next year from state asset sales to reduce its public debt, which at 109.3 percent of economic output was the highest in the eurozone in 2004. French bank Credit Agricole said on Thursday it would take part in the state-controlled bank’s 397-million-euro rights issue aimed at boosting Emporiki’s equity, which was eroded by pension fund liabilities. Credit Agricole’s announcement ended weeks of uncertainty about its intentions to maintain its stake of 9 percent of share capital and 11 percent of voting rights. It also has an option to buy the government’s 9.5 percent stake by the end of the year. «We met with the French recently. They are still looking into whether they will increase their stake in Emporiki,» the official said. Based on Emporiki’s current market value of 3.21 billion euros ($5.2 billion), a sale of 9.5 percent could fetch about 305 million euros for state coffers. Last month a dispute erupted between the government and Credit Agricole over the terms of an agreement allowing Agricole to sell back its stake in the Greek lender at the original, and much higher, price it paid in 2000. But both sides have recently downplayed the issue. «As regards the issue of Credit Agricole selling back its stake to Emporiki, the matter is settled,» the official said but provided no other details. The government is planning to sell its direct 9.5 percent stake in Emporiki Bank, held by state portfolio management agency DEKA, by the first quarter of next year. Last week Emporiki reported a rise in nine-month group net profit to 67.4 million euros as a boom in mortgages and consumer credit offset the impact of a strike.