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Greece to conclude major property deal in June: privatization chief
May 26, 2016 / 1:22 PM / 2 years ago

Greece to conclude major property deal in June: privatization chief

ATHENS (Reuters) - Greece will conclude the sale of a prime seaside property at the old Athens airport of Hellenikon in June, boosting proceeds from state sales this year to more than 2 billion euros ($2.2 billion), the privatization agency chief said on Thursday.

Chairman of the Hellenic Republic Asset Development Fund (HRADF) Stergios Pitsiorlas poses for a picture at his office before an interview with Reuters in Athens, Greece, April 11, 2016. REUTERS/Alkis Konstantinidis

Privatization has been a key condition of Greece’s international bailouts since 2010, but political resistance and bureaucratic snags mean few have gone ahead so far.

After six months of talks, Greece reached a deal with its foreign creditors on Wednesday unlocking desperately needed bailout loans on conditions including speeding up privatizations.

“I believe that we will be ready within June,” Stergios Pitsiorlas told Skai television, after the agency concludes talks with investors to amend some terms of the sale.

Greece clinched the 915 million euro ($1 billion) deal for the sale and long-term lease of Hellenikon property to a consortium led by Lamda Development (LMDr.AT), with Chinese and Abu Dhabi-based firms, in 2014.

Divisions among local communities and technical hurdles have delayed the sale. “There must be a final agreement which will convince the people,” Pisiorlas said.

Athens can raise more than 2 billion euros from divesting state assets this year, he added, and can approach a 6 billion euro target by 2018.

A migrant crisis since the beginning of last year has also impeded Athens’ efforts to conclude the Hellenikon deal.

About 54,000 refugees and migrants were stranded in the heavily indebted country en route to northern Europe after neighbors closed their borders to manage the influx about three months ago. Some 3,600 people, including many young children, were sleeping in tents in Hellenikon in overcrowded conditions with poor sanitation and little food, according to aid groups.

After clearing out Europe’s biggest refugee camp close its northern border with Macedonia, Greece said on Thursday that evacuating Hellenikon will be their main priority now.

    Under an updated privatization plan published in the government’s official journal on Wednesday, Greece plans to sell a 5 percent stake in its dominant telecoms operator OTE (OTEr.AT).

    It will also sell minority stakes in its water utilities in Athens (EYDr.AT) and Thessaloniki (TWSr.AT), Pitsiorlas said.

    “On water utilities, let’s make it clear: the majority stake will remain under state control,” he said.

    Despite strong opposition, Greek parliament approved on Sunday the creation of a privatization umbrella fund which will operate from 2016 for 99 years. The issue prompted the resignation of a lawmaker from the ruling leftist SYRIZA party.

    Pitsiorlas defended the new entity, saying it would have more flexibility on developing state property, help the economy to return to growth. This week’s debt deal would also encourage investment.

    “It’s up to us from now on, it’s in the Greek government’s and Greek people’s hands... to speed up and enter a growth era.”

    Reporting by Angeliki Koutantou, Editing by Renee Maltezou/Ruth Pitchford

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