Marfin begins takeover negotiations for Olympic

By Kerin Hope in Athens

Published: February 9 2009 17:17 | Last updated: February 9 2009 17:17

Greece’s Marfin Investment Group starts negotiations on Tuesday with the Greek government to buy 100 per cent of Olympic Airlines, the ailing state-owned carrier, after an international tender collapsed last week.

Marfin, an investment holding group listed on the Athens stock exchange, said it is committed to investing at least €200m to acquire Olympic – Europe’s last fully state-owned carrier - and restructure its operations.

A Marfin official said the group wants to buy Olympic’s three divisions – flying operations, ground handling and the technical base – which were offered separately in the failed tender.

“It’s all or nothing, Olympic needs restructuring as a fully integrated airline,” the official said.

Marfin was the only group that responded to the government’s last-ditch call for a private Greek investor to rescue the airline, which has been losing an estimated €2m a day.

Aegean Airlines, a fast-expanding private Greek carrier, last year carried more passengers than Olympic for the first time.

The government has set a minimum price of €110m for Olympic based on an independent valuation of its assets. It is keen to reach a deal quickly so that services can be upgraded by the start of the tourist season in April.

Marfin has cash reserves of €1.2bn following the sale last year of its minority stake in Hellenic Telecoms, the public operator, to Deutsche Telekom.

The Marfin official said the group is open for co-operation with other local investors if they come forward. Last week Athens Airways, a new private airline that operates one domestic route, said it was keen to participate in a rescue bid for Olympic.

Olympic pilots yesterday broke ranks with the airline’s other unions to support Marfin’s bid. The airline’s 4,500 permanent workers still officially support state ownership.