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Greek state petitions bankruptcy court over troubled Hellenic Shipyards

By A. Tsimplakis

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The Greek state late last week filed a petition with an Athens first instance court requesting insolvency proceedings against the troubled Hellenic Shipyards S.A at Skaramangas under the newly revised bankruptcy code, which foresees the rapid sale of assets and withdrawal of old shares.

The move comes in the wake of a decision by an international arbitration tribunal in favor of the current French-Lebanese group that runs the shipyards, and with the latter pointing to a complete vindication in its lengthy legal tussle with the Greek state.

Privinvest, in fact, called on the Greek state to respect the court’s ruling and warned of further legal claims, both in Greek courts and international venues.

In terms of the latest development, Deputy Economy Minister Stergios Pitsiorlas, the previous head of Greece’s privatization agency (HRADF), said discussion over the bankruptcy petition is scheduled for mid November, assuming the court accepts the petition.

Essentially the Greek government has commenced the process to force the current owners to abandon the shipyard and to seek a new strategic investor.

The Privinvest group last week said it was expecting compensation from the Greek state of between 150 to 200 million euros, following to a ruling in favor of the company by the International Court of Arbitration of the International Chamber of Commerce.

The case before the international tribunal pitted the French-Lebanese Safa family, which controls Privinvest, against the Greek state. The former charged that the Greek state had failed to meet contractual agreements worth hundreds of millions of euros following Privinvest’s purchase of the Piraeus-area Hellenic Shipyards in 2010

Among others, Privinvest executive Iskandar Safa had sought arbitration in his capacity as an individual investor in the company, while the same dispute extends to a bilateral investment pact between Lebanon and Greece.