Cosco becomes majority owner of Port of Piraeus

The first phase of the Greek port’s privatisation is complete with the Chinese container terminal operator paying €280.5m for a 51% stake.

China’s container terminal operator Cosco is now majority owner of the Port of Piraeus, an asset the Greek government has been meaning to sell since 2011, when it announced an ambitious €50 billion privatisation programme.

In what the Hellenic Republic Asset Development Fund (HRADF), the government agency in charge of privatisation, described as a milestone agreement, Cosco now owns a 51 percent stake in the asset for which it paid €280.5 million. It will acquire an additional 16 percent for an extra €88 million after five years, provided it meets certain conditions stipulated in the share purchase agreement.

The agency did not disclose all the prerequisites for the second and last phase of the deal, but said that Cosco is required to make mandatory investments of up to €300 million.

The total value of the agreement amounts to €1.5 billion and includes expected revenues from the concession agreement of €410 million, HRADF said in a statement on Wednesday.

“The total amount takes also into account the expected dividends and interest receivable by the HRADF as well as the estimated investments (apart from the mandatory) until the expiration of the concession, in 2052,” HRADF said.

Cosco has already been operating and managing Piers 2 and 3 of the port under a 35-year concession agreement it was awarded in October 2009. The Piraeus Port Authority (PPA) manages Pier 1.

According to reports earlier this year, Cosco was also interested in bidding for TrainOSE, the state-owned rail operator that has been on the block three times since 2013. Last month, however, HRADF named Ferrovie Dello Stato Italiane, as preferred bidder. Italy’s state-owned rail operator was the sole bidder for the asset.

The Greek government had also tried to attract bidders for Rosco, a newly established company that maintains the rolling stock, in January, when it launched its latest tender for TrainOSE. No binding bids were submitted. Last month, HRADF re-launched the tender for Rosco, setting 12 September as the deadline for expressions of interest and 31 October as the deadline for binding bids.