Fraport signs €1.2bn Greek airport deal

The German operator and local partner Copelouzos were named preferred bidders for a contract to manage the 14 provincial hubs more than a year ago.

The Greek government today cleared doubts over its first big privatisation deal by awarding a €1.234 billion contract to lease and operate 14 airports to Frankfurt-based Fraport.

The signature comes more than a year after the company was selected alongside Copelouzos, a local energy group and its junior partner in the consortium, to run the provincial hubs. It is a significant step in the country’s efforts to meet its €3 billion asset sale target for 2016.

The deal had been in stand-by since January, when a coalition led by the leftist Syriza party won general elections on a platform opposed to asset sales. Momentum to resume the process picked up after Greece reached an agreement with its creditors last August over the terms of a third economic bailout.

“Since being selected as preferred bidder […] Fraport and Copelouzos have remained steadfastly committed to the Greek regional airports – a win-win project for Greece and its people,” said Fraport chairman Stefan Schulte.

Upon completion of the deal, which is expected for autumn 2016, Fraport will have a clear majority stake in the concession companies. Copelouzos will hold the remaining share. Along with the upfront settlement, the consortium will pay an initial fixed concession fee of €22.9 million annually.

The mainland hubs include Aktio, Kavala and Thessaloniki, Greece’s second-largest city. The other 11 are located on Greek islands popular among tourists, including Corfu, Crete, Kefalonia, Kos, Mitilini, Mykonos, Rhodes, Samos, Santorini, Skiathos and Zakynthos.

The airports are expected to post total traffic of 23 million passengers altogether for 2015, more than three-quarters of which Fraport says will be accounted for by international travellers.