Privatisation of Greek gas company DEPA fails
Greece has failed to attract any binding bids for the natural gas firm DEPA as the key contender Gazprom and several other Russian and Greek companies dropped out of the race for the energy asset.
Reuters quotes two Greek officials close to the sale as saying
that, "Greece has received no binding bids for DEPA and one
bid, from Azerbaijan's SOCAR, for (gas grid operator) DESFA"
The deadline to submit binding bids expired at 1000 GMT on Monday. Sale of Greece’s state-owned Public Gas Corporation DEPA has been considered the key to meet the country's privatisation targets under its international bailout plan. Greece reportedly expected to get up to 1.5 billion euros for the sale. DESFA is fully owned by DEPA, but the two are being sold separately. DESFA is valued at about $650 million, and it operates all the country’s transmission pipelines and the entire distribution network, along with an LNG terminal, oilprice.com reports.
Gazprom was considered the main bidder ready to offer overstated
1.9 billion euros for both firms, BFM reports.
Gazprom explained its decision not to submit a bid in a
“We have not received sufficient guarantees that the financial
position of the company DEPA will not worsen by the time of
completion of the transaction. All procedures for the approval
and registration of the purchase of DEPA after the results of the
tender can take about a year. The company already has serious
problems with consumer non-payments. It will have to restructure
its subsidiary DESFA after the spin-off. The bidders are
not guaranteed that the state regulation of DEPA won’t
worsen. All this creates significant risks affecting the value of
the company, and the price of the transaction is proposed to be
fixed right now, without taking into account these factors”.
Another Russian company "Sintez", two Greek consortium and the
Azerbaijani state company "SOCAR" were named among other
The privatization has been repeatedly postponed. Washington had
warned Athens against the sale of the assets to the Russian gas
Gazprom is already DEPA's main supplier, providing about 60
percent of its gas last year. It cut its supply prices by about 7
percent in 2011, but Greek energy players say prices are high
compared with what Gazprom charges in other parts of Europe with
more competition, Reuters reports.
Gazprom's role as supplier to DEPA has raised concerns in the
European Union, which is already trying to loosen Gazprom's grip
on Europe's energy market, and it could have blocked or imposed
stringent conditions on the deal, Reuters reports.
The EU is also reluctant for Gazprom to expand
into Europe. In September 2012 the European Commission launched
an anti-trust investigation into Gazprom over alleged unfair
competition and price fixing If Gazprom is found to have broken
the rules it could be fined 10% its annual revenue or