Snam Consortium Wins Desfa Bidding
Italian gas grid operator Snam said April 19 that its consortium has won the tender to buy the 66% operating interest in Greece's gas grid Desfa.
The consortium – Snam (60%), Spain's Enagas and Belgium's Fluxys (each with 20%) – secured the 66% stake with its bid of €535mn ($662mn). The Greek government will retain the other 34%.
The Greek privatisation agency Hradf (or Taiped, in Greek) earlier this week asked the Snam-led consortium to increase its offer. Given at that time this was reported as €535mn, it's believed that the consortium declined to do so. It had already won the run-off against a rival bid consortium.
Desfa owns a high-pressure gas grid of 1,500 km, plus an LNG regasification terminal at Revithoussa near Athens. Snam, Enagas and Fluxys are already shareholders in the Trans-Adriatic Pipeline (TAP) project that by 2020 will link Turkey via Greece and Albania to Italy, delivering Shah Deniz phase 2 gas to Europe.
Snam said discussions have started with a pool of Greek and international banks to secure a non-recourse financing package for the acquisition. Signing of the agreements for the acquisition is subject to the completion of the further steps envisaged by the tender procedure and by local legislation on privatisation, it added, while the closing of the transaction is expected in 2H 2018, following anti-trust approval.
Desfa generated much improved 2017 pre-tax earnings (Ebitda) of €177mn benefiting from non-recurring tariff items, while its net profit was around €5mn, said Snam in its statement.
There was no immediate statement from Hradf, other than it had begun an auction process for a majority interest of at least 50.1% interest in Greek refiner Hellenic Petroleum.
The 66% stake in Desfa being sold belongs partly to Hellenic Petroleum (35%) and partly to Hradf (31%).
The award to the Snam-led consortium marks the end of a five-year process which initially saw the 66% Desfa stake awarded to Azerbaijani state producer and transporter Socar for €400mn, only to have its offer blocked by the European Commission on competition grounds. Then Socar rejected a compromise whereby it would have held a minority Desfa interest.
Snam CEO Marco Alvera said the tender result "confirms the central role of Italy in the energy infrastructure sector in Europe and the Mediterranean area" and said the partnership with Enagas and Fluxys would"further develop Desfa, the Greek market, the Energy Union and the entire energy system of Mediterranean Europe."