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Cosco Pacific sole bidder in Piraeus port privatisation

Cosco Pacific sole bidder in Piraeus port privatisation
Cosco Pacific is understood to be the only party bidding to acquire of the 67% stake held by the Greek state in the country’s largest port, Piraeus.

Hong Kong-listed Cosco Pacific was the only party to submit a timely binding offer in the context of the tender proclaimed in 2014 by the state privatisation fund (Taiped) by the 21 December deadline, and it did so just four hours before it expired.

Despite expectations, it appears Greece is still a long way from becoming the holy grail of investors around the world ­ perhaps explaining why Taiped refrained from announcing anything on the offers submitted. In a statement Taiped said “details of the interested buyers will only be released upon the opening of the binding bids on January 12”.

The binding bid process has dragged on for so long other interested parties appear to have lost interest. Indeed, just days before the deadline rumours in the marketplace of a further delay in the Piraeus Port Authority (PPA) privatisaion process, the fifth, was likely as Shipping & Island Policy Minister, Thodoris Dritsas, and a segment of the governing Syriza party sought changes to the composition of what was being sold.

A final version of the concession contract for the port installations in Piraeus was sent to the bidders just a week before the deadline.

The patience of the interested investors ­ Cosco, Danish container terminal operator APM Terminals, and Philippines-based International Container Terminal Services (ICTSI), has been tested. Over the last 18 months they have been spending time and money on an apparently endless procedure. Indeed, APM and ICTSI seem to have lost interest.

A majority 51% stake of the PPA is up for sale initially, with another 16% over five years, conditional on the owner investing EUR350m.

Opening of the company’s bid will take place along with the opening of the independent experts’ appraisals (Cantor and American Appraisal Hellas) that Taiped has commissioned.

If the price offered exceeds the level of both appraisals, then the Cosco offer will be accepted. If it is between them, Taiped will ask Cosco for an improved offer. However, if the bid is below both appraisals, the tender will be deemed to have failed.

Port workers fearing job cuts have opposed the further privatisation of both Piraeus and of Thessaloniki Port Authority , operator of the country's second biggest port which is also 67% government-owned. Deadline for final bids for Thessaloniki has been set for April.

Container port workers across the country walked out and demonstrated in central Athens on Piraeus deadline day, asking for both sales to be cancelled.

"It's a kind of policy that undermines the country's growth because it sells its advantage, Piraeus and Thessaloniki ports, to foreign state monopolies," head of Greece's port workers union George Georgakopoulos told Greek television. "The fire-sale of the port should stop."