Hellas starts expansion process

Hellas will annul a tender to privatise and upgrade facilities at the country's second-largest port in Thessaloniki.

Hellas will annul a tender to privatise and upgrade facilities at the country's second-largest port in Thessaloniki after the top bidder withdrew due to the global crisis, government and company sources said on Tuesday. "We are essentially cancelling the tender," said a company official, who requested anonymity. "The company has already started the expansion process ... using its own funds."

He said the cancellation would be announced officially by the end of next week. A government official, who declined to be named, confirmed the tender would be cancelled.

Greece launched tenders last year to turn two of its ports, among the largest in the eastern Mediterranean, into regional hubs and boost competitiveness. Piraeus Port sealed a deal with China's Cosco Pacific in November.

But the Thessaloniki port tender fell victim to the global crisis. The top bidder, Hutchison Port Holdings and Greek pharmaceutical group Alapis, pulled out in December due to difficulties with financing for the project.

"The reasons for the withdrawal have to do with the economic crisis, which has affected many sectors, especially shipping, and the difficulty of banks to finance Hutchison's ambitious plans," OLTH spokesperson Chrysanthi Athanasiou said in December.

HPH, which has operating rights in 45 ports around the world, had offered 3.1 billion euros ($4.94 billion) for the project in Thessaloniki. It had also pledged to invest 489 million euros to upgrade the port's facilities.

OLTH is 74 percent state-owned. Its shares, trading up 0.6 percent at 9.46 euros on Tuesday, have lost about 61 percent of their value since February last year, in line with the benchmark index.

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