ADMIE to remain under state control, creditors have agreed

Greece’s Independent Power Transmission Operator (ADMIE) will cease to be independent as the government and its creditors agreed on Thursday and Friday that it should split from the Public Power Corporation (PPC) and be converted into a company that will be a 100 percent subsidiary of the state, ahead of the privatization of a minority stake.

The plan that has been agreed in principle will provide for the state to hold on to a majority stake of 51 percent and a strategic investor to take 20 percent, while the remaining 29 percent will be floated on the local stock market.

There are certain details that remain to be decided upon, mainly concerning the management and the choice of a strategic investor. The agreement provides for the majority of seats on the governing board to be held by the state, while the chief executive and the business plan will be jointly agreed with the strategic investor.

After the grid operator has been converted into a state-held company, a tender will be called for the sale of 20 percent of ADMIE to a network operating company from a European Union country, with the remaining 29 percent to be listed on the bourse.

However, before the above can take place, sources from the Energy Ministry said that there will first be an independent assessment of the price that PPC should receive as compensation for the grid operator. This will also incorporate the settlement of pending issues within the PPC group, which add up to 400 million euros.

The same sources explained that, this way, PPC can be compensated sooner rather than later, as was the provision of the original plan that the government and its creditors had discussed earlier this week. The timetable for the implementation of the agreement has yet to be drafted.

Two questions stemming from the deal are how the tender will rule out any grid operators from outside the European Union taking a stake and why the agreement refers exclusively to EU companies when interest has been expressed by firms from China and Canada.