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Rail privatisation included in Greek asset sale

03 Jun 2010

GREECE: The government announced the part-privatisation of Hellenic Railways Organisation on June 2. Stakes in a range of state-owned road, port, airport, utility and land assets are to be sold under agreements with the European Commission and international financial institutions which aim to reduce debt and tackle the country's economic crisis.

A 49% stake in train operating business Trainose will be sold to a strategic investor, which will be responsible for management. There will be market-based agreements for services and maintenance.

The Ministry of Infrastructure will release a comprehensive recovery plan for OSE by the end of June, setting out plans to cut the railway's annual losses of €1bn and €10bn of debt. Restructuring is likely to include the separation of passenger and freight activities, a reduction in staff and closure of loss-making lines.

Future investment will be through PPP and concession agreements, with stations and commercial property to be managed through special purpose companies in which the state will have a 49% stake.