Cosco tops bids for container port

China’s Cosco Pacific Ltd yesterday emerged as the top bidder in the concession tender to operate and upgrade the Piraeus container terminal, the port authority (OLP) said in a bourse filing. Cosco, the world’s fifth-largest container port operator, offered 4.3 billion euros (of which 79 percent is guaranteed) for the contract to operate the port’s commercial docks for up to 35 years, and will invest a further -620 million (75 percent guaranteed) to upgrade them. Cosco outbid Hutchison Port Holdings which, in partnership with Greek pharmaceutical group Alapis, offered -4.06 billion and a further -354 million in investment. The government, which faced strong opposition from unions that are still applying an overtime ban, welcomed the announcement. «The bids surpass our expectations, showing that our policy was in the right direction. We are implementing a great reform, with huge economic benefits,» said Merchant Marine Minister Giorgos Voulgarakis. Well-placed sources said Athens Exchange-listed OLP, which is 74 percent state-owned, had considered two scenarios for the bids, the more favorable was estimated at -2.5 billion and the other at -1.7 billion. «The country’s geostrategic importance will be boosted and Greece will become a greater sea transport hub and an entry gate into Europe. The development also broadens our economic relations with China, which is a steadily rising world power,» Voulgarakis said after briefing Prime Minister Costas Karamanlis. Voulgarakis urged dockers to return to work as usual. «The development of the port will have multiple benefits for the broader area of Piraeus and the workers will be the first to benefit,» he said. Dockers, however, rejected the call, referring to «premeditated and preconstructed… baseless scenarios» in an attempt to mislead public opinion. «The sums referred to in the OLP announcement do not say what will be the annual guaranteed rent to be paid, nor what percentage of revenue the operator will return,» the Greek Port Workers’ Federation said. «As regards investment, the only one that will be implemented will be -110 million, according to OLP’s business plans.» OLP officials claimed Cosco’s bid is was the highest ever submitted for a container terminal worldwide, and equals about seven times the company’s current capitalization, five times its total profits and at least 15 times the container terminal’s profits. They also said it was -3 billion higher than a bid for a similar concession tender for the port of Izmir in Turkey.