Greece said yesterday it will sell a major stake in Emporiki Bank by the end of 2006 and up to 25 percent of the Postal Savings Bank on the Athens bourse by this summer as part of its ambitious privatization plan. A stake in major telecom OTE might be sold to a major European peer next year but there are no plans to privatize dominant electricity utility PPC, Finance Minister Giorgos Alogoskoufis told Reuters in an interview. «This year, our target is banks,» he said. «Next year we plan to move to infrastructure, mainly ports and airports.» Greece is selling stakes in ATEbank, Emporiki and is floating the Postal Savings Bank (TT) as part of a 1.65-billion-euro ($2.1 billion) privatization agenda aimed at reducing public debt, one of the highest in the eurozone as a percentage of GDP. First on the block will be ATEbank, where the state wants to reduce its 82 percent holding to 51 percent through the Athens bourse, but not in one shot, Alogoskoufis said. Greece had said previously it wanted to sell 10 to 15 percent of the fifth-largest Greek bank by market value. ATEbank, with a market capitalization of 4.58 billion euros, trades at 21 times 2006 earnings, a premium to a multiple of 15.4 for European banks, according to Reuters Estimates. «The size will depend on market developments; we don’t have a certain percentage target,» Alogoskoufis said. Greek banks saw strong profits last year on expansion abroad and a mortgage boom, and are expected to do the same this year. With one of the largest networks in Greece, Postal Savings will be the 15th lender to list on the Athens Stock Exchange. The offering prospectus will be ready in a few weeks and the float is expected by this summer, the minister said. «The maximum we will be able to float at this stage is 25 percent,» he said. Emporiki more difficult Alogoskoufis said the case of Emporiki, which is 11 percent owned by France’s Credit Agricole, was more complicated and the sale would now be complete by autumn. Greece had intended to sell up to 24 percent from its roughly 40 percent stake in the country’s fourth-largest bank, with a current market value of 3.63 billion euros, preferably to Credit Agricole, in the first half of the year. Emporiki shares trade at 22 times 2006 earnings, according to Reuters Estimates. But French commitment came into question when the strategic investors temporarily wavered over participating in a rights issue in December. «This process is a bit more time-consuming than the others because it is more complicated,» the minister said. «I believe it’s feasible (to complete) within the fall.» On Greece’s dominant telecom OTE, Alogoskoufis said there were no plans to sell down the state’s 38.6 percent stake this year, when the top priority is to see its restructuring proceed. But next year, if a major European telecom is interested, the government, which is OTE’s biggest shareholder, would consider selling a major slice. «It will not be the whole stake and I can’t foresee a moment when the Greek state will have no interest. But it will be a big enough stake to interest a strategic partner,» he said. Next year’s agenda will also include the privatization of Greek ports and airports, maybe through a holding company which will be listed on the bourse, he said. «The priority will be on those that have the most traffic,» he said. «We are still in a planning phase but the focus is there.» Olympic Airlines The ailing national carrier, Olympic Airlines, will be succeeded by a new company that will take over its flights if Greece’s troubled carrier is forced to shut down by its debts, Alogoskoufis said. The European Union has ordered Greece to recover hundreds of millions of euros in illegal state aid handed to Olympic over the years, a move that may mean the airline’s end. Alogoskoufis said in an interview Greece was determined to keep flights going, whether by Olympic or a successor. «There is a process of creating a new company, which could take over Olympic’s flights in case Olympic is forced to shut down. There is clear investment interest in this specific solution,» he said. Competitors in the crowded European aviation sector are closely watching Olympic, founded by the late shipping tycoon Aristotle Onassis. After decades of mismanagement, repeated efforts to privatize it have failed. Greek officials said last month Olympic would keep flying until at least October while they prepared their defense at the European Court of Justice. They said a group of unidentified Greek shipowners, foreign equities funds and Arab investors were interested in the venture to succeed Olympic, whose debts could be over 700 million euros ($882.5 million) while its assets are estimated at 150 million euros. Alogoskoufis did not give further details but said he was confident the scheme, which so far exists only on paper, would materialize. «In any case, there will be a successor for Olympic,» he said. «Greece needs a second company, also for reasons of internal competition.» At the moment, only privately held Aegean Airlines serves regular internal flights in Greece, but its network is not as extensive as that of Olympic, which is a lifeline for many small Greek islands.