Greece reaches €600m deal on Athens airport

The deal, which extends the current team’s agreement for an additional 20 years, came late Tuesday evening after Greece’s privatisation agency rejected an initial offer.

Hours after rejecting an initial proposal, Greece’s privatisation agency on Tuesday accepted a €600 million offer for a 20-year extension of a PPP agreement for Athens International Airport.

The agreement will extend the company’s concession, set to expire in 2026, until 2046. AIA, the public-private partnership established in 1996 to build and run the airport, had submitted an undisclosed offer earlier that day. But the Hellenic Republic Asset Development Fund, tasked with Greece’s privatisation programme, asked the company to return with an improved offer, which they did late in the evening.

HRADF said it considered two independent evaluations in accepting AIA’s proposal. The agency expects AIA to invest approximately €2.35 billion during the extension period, and estimates that revenue from annual remuneration provided in the contract will total close to €900 million.

The Athens airport, also known as Eleftherios Venizelos, began operations in March 2001. With more than 20 million passengers last year, it is now Greece’s busiest airport. The Greek government owns a 55 percent stake in AIA, including HRADF’s 30 percent share, while private investors own the remainder. PSP Investments, a Canadian Crown corporation, holds most of the private share.

HRADF, established in 2011 to privatise state assets following the country’s government debt crisis, has twice in the past two months rejected bids for infrastructure assets and asked for improved offers. In April, HRADF turned down bids for a majority stake in the Thessaloniki Port Authority, forcing the three groups interested in the acquisition to submit improved offers two weeks later. This time, it took less than a day. 

The deal must still be approved by the Court of Auditors, the Greek Parliament and European authorities.