Greece, lenders clinch power grid deal

Under the agreement, the state will take a stake of least 51% in the operator

Greece and its lenders agreed on how to split off the country’s power grid operator from dominant power utility PPC, two government sources said yesterday, part of a set of reforms that needed for Athens to receive fresh bailout aid.

Prime Minister Alexis Tsipras’ leftist government halted the sale of a 66 per cent stake in grid operator ADMIE after winning election in January. It agreed under a third bailout deal signed in August to either restart the tender or find alternative ways to open up the electricity market.

Under the deal, the state will take a stake of least 51 per cent in the operator (ADMIE), which is now fully owned by PPC, and to qualify for €1 billion by the end of the month.

The two sides are still discussing how to deal with banks’ bad loans and the structure of a new privatisation fund whose revenues will be used to cut Greece’s debt and boost investment.

Athens is struggling to keep non-performing loans to small business and consumers out of the clutches of so-called vulture funds that buy loan books of distressed debt at a discount and try to recover the money.

Talks were expected to wrap up late yesterday so the EU and IMF mission chiefs can report back to their institutions, another government official said. The government aims to secure parliament approval for this set of reforms this week to get the €1 billion tranche by December 18.

It will then have to pass other reforms, including a major restructuring of the ailing pension system, to conclude its first bailout review and open talks for a debt relief.