Cosco (Hong Kong) Group

Greece says China’s Cosco sole bidder in Piraeus Port sale

Privatisation agency says it will ask bidder to raise offer

PUBLISHED : Wednesday, 13 January, 2016, 12:01pm
UPDATED : Wednesday, 13 January, 2016, 12:01pm

Greece only received a bid from China’s Cosco Group for a majority stake in Piraeus Port Authority, the operator of the country’s biggest port, the privatisation agency said on Tuesday.

The leftist government of Alexis Tsipras halted the port privatisation after winning elections in January last year but resumed the process under the 86 billion euro bailout deal it agreed with its euro zone partners in August.

Privatisations, a key element of Greece’s bailouts since 2010, have produced revenue of only 3.5 billion euros so far.

Athens concluded a 1.2 billion euro airport leasing deal with Germany’s Fraport in December, hoping this would help it to meet its target for privatisation proceeds of 3 billion euros this year.

The final bids for a 51 per cent stake in Piraeus Port were submitted on December 21. The prospective buyers were not made public although there was speculation that Cosco was the sole bidder.

The privatisation agency said it will ask the bidder to raise its offer.

Greece has said that Cosco, Denmark’s container terminal operator APM Terminals and Philippines-based International Container Terminal Services were interested in the sale.

The sale of a 51 per cent stake in Piraeus could fetch about US$179 million, based on the company’s market value on Tuesday.

Would-be buyers may opt to acquire an additional 16 per cent stake over five years after completing mandatory investments of about 300 million euros.

The port, a gateway to Asia, Eastern Europe and North Africa, handled 16.8 million passengers and 3.6 million 20-foot equivalent units (TEUs) of containers in 2014.

Cosco has been operating one of the port’s container terminals since 2009 and is investing 230 million euros to build a second container terminal at the port.

Cosco will merge with China Shipping in the Chinese government’s latest effort to make the industry more competitive globally. A combined entity would be the world’s fourth-largest container shipper, with a market share of roughly 8.1 per cent.