New advisers for airline sale
The government has turned to local banks for help to keep ailing state-carrier Olympic Airways afloat after dropping its international adviser for being too expensive, it was announced yesterday National, Alpha and Commercial banks will now take on the Herculean task of finding funds for the cash-strapped Olympic after a failed privatization bid. «The three banks’ investment departments are to take over the role of adviser in the privatization of Olympic Airways,» a government source said after a meeting between Economy and Finance Minister Nikos Christodoulakis and Transportation and Communications Minister Christos Verelis with the heads of the banks: National’s Theodoros Karatzas, Alpha Bank’s Yiannis Costopoulos and Commercial’s Yiannis Stournaras. The government dropped its international adviser, Credit Suisse First Boston (CSFB), last week, saying it was too expensive, but sources said the government also found CSFB’s restructuring plan for the troubled airline too drastic. Government officials have said that Olympic, which also faces a European Commission investigation into possible competition rules violation, urgently needs cash to survive beyond this summer. The airline, which expects losses of 85.1 million euros in 2001 and whose debt is estimated at hundreds of millions of euros, is trying to shape up ahead of being put on the market again. Sources close to the privatization effort told Reuters that CSFB had proposed cutting 4,700 jobs, seriously curtailing international flights and shedding all activities except flying. Olympic now has about 9,000 employees. The EU investigation has added to Olympic’s woes. If state funding rules have been violated, the airline would be forced to return hundreds of thousands of euros, effectively being forced into bankruptcy. This would make it the third major European airline to collapse in a year after Swissair and Sabena. (Combined reports) The region absorbs large segments of certain categories of Greek exports, such as 35 percent of petroleum products ($520 million), 25 percent of tobacco ($95 million), 53 percent of textile fibers ($164 million) and 78 percent of natural and industrial gases ($66 million).
