The Greek government reached an agreement in principle with the institutions on the controversial privatization of Greece’s Independent Power Transmission Operator (ADMIE).
The government’s proposal includes the spinoff of ADMIE to a new entity that will be fully controlled by the Greek State and then the sale of a 20% stake to a strategic investor initially and at a later stage, a second placement of a 29% stake. With this plan, the Greek State will retain a majority stake (51%) in the electricity transmitter.
Regarding management of the new company, CEO and business plan will be approved by both the State as well as the new strategic investor while the majority of the governing board members will be Greek nationals.
Management and strategic investor
There are certain details that remain to be decided upon, mainly concerning the management and the choice of a strategic investor.
However, before the above can take place, sources from the Energy Ministry said that there will first be an independent assessment of the price that PPC should receive as compensation for the grid operator. This will also incorporate the settlement of pending issues within the PPC group, which add up to 400 million euros.
The same sources explained that, this way, Greece’s Public Power Corporation (DEH) can be compensated sooner rather than later, as was the provision of the original plan that the government and its creditors had discussed earlier this week. The timetable for the implementation of the agreement has yet to be drafted.
New privatization fund
Two questions stemming from the deal are how the tender will rule out any grid operators from outside the European Union taking a stake and why the agreement refers exclusively to EU companies when interest has been expressed by firms from China and Canada.
Furthermore, an agreement was also reached in relation to the framework of the new privatization fund that is going to replace the existing fund, TAIPED. In the five-member governing board of the new fund, three will represent the Greek government, while the other two will represent Greece’s creditors.
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