Is Terna getting ready to bid for stake in grid operator ADMIE?

Italian grid operator Terna is expected to be present at the tender for the sale of a 24 percent stake in the Independent Power Transmission Operator (ADMIE), after being the favorite to win the original tender for the sale of a 66 percent stake of the Public Power Corporation subsidiary, which was halted by the government in December 2015.

A sizable representation from the Italian group arrived in Athens on Tuesday and according to sources visited both ADMIE and the office of Environment and Energy Minister Panos Skourletis.

The arrival of the Terna officials coincided with PPC’s publication of the invitation for expressions of interest in the 24 percent stake in ADMIE, just a day after the utility’s general meeting approved the grid operator’s separation from PPC.

PPC appears to be seeking the fastest possible completion of the process for the implementation of the current plan that ensures the state remains in control of ADMIE. If the timetable agreed with the country’s creditors is not adhered to, the law dictates a 100 percent sale of the grid operator.

As a result, the deadline for the stake sale is particularly tight and the preferred bidder will have to be selected by October.

Meeting the target will also depend on whether there will be adequate investor interest, as, besides the complex process and technical difficulties, investors will have to factor in the fact that they will only control a reduced stake, of 24 percent, and will have the Greek state as a partner.

The Italians however appear unfazed and are eyeing a strategic position in the domestic market.

Belgian grid operator Elia is waiting in the wings after also making an appearance in the first tender. Since then, though, its interest appears to have subsided. Canadian fund PSP Investments had also expressed an interest in the first tender.

At this stage, provisional expressions of interest will be confirmed on July 20, when, according to the invitation by PPC, the candidate buyers will have to submit their entry in the first phase of the two-stage tender. In order to qualify to take part in the tender, the companies must be national electricity network operators participating in a grid that is a member of the European Network of Transmission System Operators for Electricity (ENTSO-E), or consortiums with at least one member from the aforementioned. Bidders must also have had an average capital availability of at least 350 million euros in the last three financial years.