June 12, 2008 / 10:46 AM / 12 years ago

UPDATE 2-Piraeus Port names Cosco provisional tender winner

(Adds bid details in 5th graph, minister quote)

ATHENS, June 12 (Reuters) - Greece’s Piraeus Port (OLP) (OLPr.AT) said on Thursday that China’s Cosco Pacific (1199.HK) was the provisional winner of a tender to run and upgrade port facilities for up to 35 years.

“The board of directors decided that Cosco is the provisional winner of the tender to upgrade OLP’s Pier 2 and Pier 3,” the company said in a bourse filing.

OLP has said that Cosco, the world’s fifth-largest container port operator, offered 4.3 billion euros ($6.63 billion) to operate two piers in one of the top ten container terminals in Europe.

The amount will be paid over the duration of the contract, and Cosco will invest a further 620 million euros in upgrades.

Cosco will pay an initial amount of 50 million euros to OLP, a further 591 million euros in rent over the period, and a guaranteed amount of at least 2.7 billion euros from future earnings, Greece’s Merchant Marine Minister told reporters.

“Turnover at the port will increase substantially and boost profit for companies using the port and its facilities,” the minister, George Voulgarakis, said.

Cosco’s offer bettered the 4.06 billion euro bid made by Hutchison Port Holdings 0013.HK, a unit of port operator Hutchison Whampoa, which had said it would invest a further 354 million euros on upgrades.

Greece, with two of the largest ports in the eastern Mediterranean region, launched tenders for Piraeus and the northern Greek Thessaloniki harbour (OLTr.AT), in an effort to turn them into regional hubs and boost cargo business.

OLP’s shares were trading 0.5 percent up at 25.20 euros in late trading on the Athens bourse. The company, which is 74 percent state-owned, has a market value of 627 million euros according to Reuters Estimates. (For story on Thessaloniki port tender click on [ID:nL0624113], for story on Cosco’s bid in OLP’s tender click on [ID:nHKG343844]) (Reporting by Renee Maltezou; writing by George Hatzidakis; editing by Rory Channing/Elaine Hardcastle)

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