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Thread: Italian state railway group buys Greece’s national train operator for €45m

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    Italian state railway group buys Greece’s national train operator for €45m

    I had been expecting the China Ocean Shipping Company COSCO to gain control of Greece's Trainose, but it seems that COSCO did not submit a bid.

    Privatisation agency accepts FS bid for Trainose
    18 Jul 2016

    GREECE: The Hellenic Republic Asset Development Fund confirmed on July 14 that it had accepted an €45m offer from Italian state railway group Ferrovie dello Stato Italiane for 100% ownership of Greece’s national passenger and freight train operator Trainose.

    This followed positive recommendations from HRADF’s advisers, two independent valuations and the Council of Experts which reviews privatisations.

    Completion of the deal is subject to approval by the Court of Auditors and other authorities. HRADF said privatisation would 'secure not only the viability of Trainose, but more importantly, its further development'. It would also lay the foundations for the closure of a European Commission state aid investigation into debts of more than €700m that Trainose owes to national railway OSE.

    Russian Railways and infrastructure, waste and mining group Gek Terna had previously submitted expressions of interest in buying Trainose, but FS Group submitted the only biding offer.

    Investment Bank of Greece and Kantor acted as financial advisers for the tender process, M&P Bernitsas and Hogan Lovells acted as legal advisers, and Hogan Lovells also acted as technical adviser.
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    Some context to the Cosco reference...

    Workers Protest as Greece Sells Piraeus Port Authority to COSCO
    Fri Apr 8, 2016

    (Reuters) - Greece sealed the sale of Piraeus Port Authority (OLPr.AT) to China COSCO Shipping Corporation (601919.SS) on Friday, while striking dockworkers protested against what will be the country's second major privatization since late last year.

    The sale of Greece's biggest port had been halted by the leftist government of Alexis Tsipras when it won elections in January last year but it was resumed under Greece's 86 billion-euro bailout deal agreed with its euro zone partners in August.

    Dockworkers walked out on Friday and marched in central Athens to protest against the deal, which they fear will put their jobs at risk. Container terminals were shut as a result of the strike. Brief scuffles broke between police and some of the protesters

    "This is not a concession, it's a giveaway of property belonging to the Greek people," Constantinos Tsourakis, a worker at the port, said. "Why should China be masters of the game at Piraeus and not the Greek state?"

    Under the 368.5 million euro ($418.58 million) deal, signed on Friday by China COSCO with Greece's privatization agency, COSCO will buy 51 percent of Piraeus for 280.5 million and the remaining 16 percent for 88 million after five years and once it completes investments of 350 million over the next decade.

    China COSCO Chairman Xu Lirong, present at the signing, likened Piraeus Port to the 'Argo', the ship used by Jason and the Argonauts.

    "Let the ship sail and bring the Golden Fleece," Xu said, adding that COSCO would invest in upgrading infrastructure at the port and that new jobs would be created.

    "China COSCO Shipping ... will continue to be committed to Greek growth in the long-term," he said.

    Chinese Prime Minister Li Keqiang invited his counterpart Tsipras to visit China, Tsipras' office said after the signing of the deal on Friday. The trip is planned for June.

    The total value of the COSCO contract is 1.5 billion euros ($1.70 billion), including additional investment, as well as revenues of 410 million euros, dividends and interest Greece is expecting to collect under the 36-year concession deal between Piraeus Port and the government.

    Privatizations, a major element of Greece's bailouts since 2010, have produced revenue of only 3.5 billion euros so far because of political resistance and bureaucratic hurdles.

    Athens concluded a 1.2 billion euro airport leasing deal with Germany's Fraport (FRAG.DE) in December, hoping this would help the country meet this year's target for privatization proceeds of 1.9 billion euros.

    In January, Greece named COSCO as the sole bidder for Piraeus Port. Τhe 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.



    I suspect Greece might have gotten a much larger bid from COSCO for Trainose had it not been for this bit of slippery dealing:

    COSCO Greece says Piraeus Port sale terms inconsistent with deal
    Wed Jun 29, 2016

    (Reuters) - COSCO Greece objected on Wednesday to terms submitted to parliament for the sale of Piraeus Port to China COSCO Shipping, saying they were inconsistent with those previously agreed with the Greek privatization agency.

    Greece sealed the sale of Piraeus Port Authority (OLPr.AT) to China COSCO Shipping Corporation (601919.SS) in April, a major step for the bailed-out country in meeting the demands of international creditors that it step up privatizations.

    Under the 368.5 million euro (£298 million) deal, COSCO will buy 51 percent of Piraeus for 280.5 million euros and the remaining 16 percent for 88 million after five years and once it completes investments of 350 million euros over the next decade.

    The terms of the deal were submitted by the country's shipping ministry to parliament for approval on Tuesday. But, COSCO Greece said in a letter to lawmakers seen by Reuters that key elements of the deal appeared to have been altered.

    "The content of the specific plan is a complete reverse of what was agreed between COSCO HK and TAIPED (HRADF)," an email sent by COSCO Greece said, referring to the country's privatization agency.

    It said that 'key terms' on which COSCO's offer was based, had been erased. It included an obligation by the state to approve project licensing within a specific timeframe.

    A lack of such guarantees, the COSCO note said, would have materially affected the amount it bid for the project, and possibly affected the submission of a bid altogether.

    Shipping Minister Theodoris Dritsas acknowledged that there were differences, but said the government had the right to make changes and the ministry was willing to make improvements.

    "The government will look into it, it will look into the objections and will probably consider making improvements," Dritsas told lawmakers.

    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 its container terminals since 2009.

    Lawmakers had been expected to endorse the deal on Thursday, before Prime Minister Alexis Tsipras's state visit to China which starts on July 1.
    Last edited by JRT; 24 Jul 16, at 23:13.
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    Port of Piraeus in Greece will be receiving Cosco's neopanamax containerships from China, and Cosco's expansion there will probably be both soon and significant. I would also expect that China will have interest in protecting these trade routes.



    1st Ship to Pass Through Expanded Panama Canal Sails from Greece
    Jun 12, 2016

    The container ship Cosco Shipping Panama, which on June 26 will be the first to pass through the expanded Panama Canal, set sail Saturday from the port of Piraeus, Greece, on its way to this Central American country, official sources said.

    Canal administrator Jorge Luis Quijano, currently in Greece with a delegation of the Panama Canal Authority, or ACP, had the chance to meet the ship’s captain, Jude Rodrigues, and his crew, before the container ship makes the 14-day crossing, the ACP said.

    “It was great being able to meet the captain and crew and see the quality of the team that will be piloting the ship through the waters of the canal together with our personnel who will be aboard that day from very early on,” Quijano said in an official statement.

    The New Panamax vessel, 48.25 meters (158 feet) abeam and 299.98 meters (984 feet) long, was launched in January this year, and will carry through the canal its maximum cargo of 9,472 TEUs (containers).

    On inauguration day, the ship will start in the morning in the locks of Agua Clara on the Caribbean side, and will end in the locks of Cocoli on the Pacific in the afternoon. The rest of the crossings will continue the next day, the statement said. (source: EFE)
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    Quote Originally Posted by JRT View Post
    I had been expecting the China Ocean Shipping Company COSCO to gain control of Greece's Trainose, but it seems that COSCO did not submit a bid.
    How can a Bankrupt state owned railway company buy anything????

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