BlackRock to Assist Greece in Privatizing Remaining State Assets: Full Details Inside

Greece’s Ambitious Economic Revival Plan

At the beginning of this year, Greece embarked on an ambitious initiative aimed at raising €5 billion (approximately $5.47 billion) as part of a privatization and economic recovery program.
The country appears to be making significant progress towards achieving this goal.

The Hellenic Asset Development Fund (HRADF) has recently reviewed six proposals for an operational agreement concerning the Lavrio port.
Lavrio, the third largest port in the Attica region, is strategically located near Athens International Airport, as well as the ports of Piraeus and Rafina, making it a highly appealing asset for tourism operators and cruise companies alike.

Recent Privatization Moves

This agreement follows the privatization of various Greek banks and the initial public offering (IPO) of Athens Airport that took place in February.
According to Bloomberg’s data, the IPO generated €785 million for the country at the time of listing.
Furthermore, the HRADF is advancing with the privatization of Attiki Odos, Greece’s toll road system, offering a 25-year concession, with the leading bid currently at €3.27 billion.

New Sovereign Fund Initiative

In parallel with these transactions, Greece is moving forward with plans to establish a new sovereign wealth fund.
This fund will facilitate the sale of state assets, including properties, ports, and public services, starting with an allocation of €300 million.
Minister of Finance Kostis Hatzidakis has stated that the proceeds from asset sales will be reinvested in green projects, infrastructure, and cutting-edge technologies.
Notably, BlackRock Inc., a global investment management giant, will serve as the country’s advisor on effectively structuring the fund to meet these objectives.

BlackRock’s Strategic Moves

In February, BlackRock reorganized its influential Financial and Strategic Investors Group, which delivers services to central banks, sovereign funds, insurance companies, and financial service firms.
During this reshuffle, BlackRock expressed its intention to “accelerate the momentum” in this sector and adjusted the group’s leadership accordingly.
The company has since partnered with the Saudi Arabian sovereign fund to launch BlackRock Riyadh Investment Management, a multi-asset company aimed at boosting investments in the region.
Greece appears to be the next focus for this ambitious group.

Collaboration for Economic Growth

The new sovereign fund will be distinct from the existing €5.5 billion national fund, known as the Growthfund.
This fund holds a 25% stake in Athens International Airport and a 34.12% stake in Public Power Corp.
SA.
The organization is currently working towards transforming itself into a national investment fund akin to those in other parts of Europe.

Strategic Vision and Future Impact

As part of this effort, the government is also looking to consolidate the HRADF, the Hellenic Financial Stability Fund (the country’s bank bailout fund), and the Hellenic Corp.
of Assets and Participations into a unified agency.

The establishment of the new sovereign fund could play a pivotal role in Greece’s ongoing endeavors to enhance the sustainability of its energy infrastructure and other economic sectors.
Greece has announced several political reforms and investments in alignment with the European Union’s REPowerEU plan, which aims to phase out oil imports from Russia.
Launched in May 2022, this plan sets a clear trajectory for Greece’s energy independence.

The creation of this new sovereign fund marks a significant milestone in this journey, providing a platform to channel privatization proceeds into strategic projects that may create a lasting impact on the nation’s economy.
Moreover, partnering with BlackRock offers Greece the chance to gain from global expertise in investment management and sovereign fund structuring.

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