Piraeus Port Authority S.A. Offering Memorandum
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PIRAEUS PORT AUTHORITY S.A. OFFERING MEMORANDUM FOR THE PUBLIC OFFERING OF EXISTING SHARES OWNED BY THE GREEK STATE AND THE ADMISSION OF THE COMPANY'S SHARES TO THE MAIN MARKET OF THE ATHENS EXCHANGE THE BOARDS OF DIRECTORS OF THE ATHENS EXCHANGE AND THE HELLENIC CAPITAL MARKETS COMMISSION HAVE APPROVED THIS MEMORANDUM SOLELY AS TO THE SUFFICIENCY OF INVESTOR DISCLOSURE, AS PER THE PROVISIONS OF PRESIDENTIAL DECREE 348/1985. For the purpose of exercise by bearers of Hellenic Republic privatization certificates due 2003, listed on the Luxemburg Stock Exchange, of rights of exchange of such certificates for shares of PPA S.A., an offering memorandum has been prepared in English (not submitted to the Capital Markets Commission for approval), which provides equivalent information to investors. ADVISOR LEAD ARRANGERS OTHER UNDERWRITERS EFG TELESIS FINANCE, ALPHA FINANCE SECURITIES, NATIONAL BANK OF GREECE, INVESTMENT BANK, PIRAEUS BANK, GENERAL BANK OF GREECE, BANK OF ATTICA, MARFIN BANK, PROTON INVESTMENT BANK, BANK OF CYPRUS LTD., OMEGA BANK, HELLENIC BANK LTD. EFG EUROBANK SECURITIES, NATIONAL SECURITIES, SIGMA SECURITIES, P&K CAPITAL ISC, N.D. DEVLETOGLOU SECURITIES, EUROCORP ISC, ARTION SECURITIES, EGNATIA SECURITIES, PEGASSUS SECURITIES, ASPIS SECURITIES, LAIKI ATTALOS SECURITIES. ATHENS, July 2003 Admission of PPA S.A. Shares to the Main Market of the Athens Exchange 1. Important Notes - Investment Risk Factors.......................................................................................... 6 1.1 Important Notes............................................................................................................................ 6 1.1.1 Background – Transformation into a Société Anonyme ...................................................... 7 1.1.2 Differences between the special provisions governing the operation of PPA SA as a Société Anonyme and the corresponding provisions of Law 2190/1920............................................. 8 1.1.3 Accounting books and financial statements of the Company ............................................ 12 1.1.4 Satisfactory Asset Structure ............................................................................................... 13 1.1.5 Fulfilment of the Requirements for Admission to the Athens Exchange........................... 15 1.1.6 Pending Legal Cases .......................................................................................................... 17 1.1.7 Significant contribution of an individual business unit to the turnover ............................. 18 1.1.8 Representations by the Lead Arrangers.............................................................................. 19 1.2 Investment Risk Factors............................................................................................................. 20 1.1.1 Company-related Risks ...................................................................................................... 20 1.1.2 Risks related to the share price........................................................................................... 27 2. Summary Presentation of the Offering............................................................................................... 29 3. Summary financial aggregates of PPA S.A........................................................................................31 3.1 Summary pro forma financial aggregates 1998 – 2000.............................................................. 31 4. Information on the compilation of the Offering Memorandum and the Auditors of the Company ... 43 4.1 General information ................................................................................................................... 43 4.2 Legal Due Diligence................................................................................................................... 44 4.3 Financial and Accounting Audit ................................................................................................ 46 4.4 Ordinary Financial Audit ........................................................................................................... 51 4.5 Tax Audits Results ..................................................................................................................... 55 5. Procedure for the Offering of Existing Shares ................................................................................... 58 5.1 General Information on the Offering.......................................................................................... 58 5.2 Listing (Sale) Price..................................................................................................................... 59 5.3 Procedure for the Placement of Offered Shares ......................................................................... 60 5.1.1 Sale of Shares by Private Placement .................................................................................. 60 5.1.2 Sale of Shares to Non Institutional Investors ..................................................................... 61 5.1.3 Sale of Shares to Institutional Investors............................................................................. 62 5.1.4 Sale of Shares to Bearers of Hellenic Republic Privatization Certificates......................... 63 5.4 General Information on the Allotment of the Offered Shares.................................................... 66 5.1.1 Allotment of Shares to Institutional Investors.................................................................... 67 5.1.2 Allotment of Shares to non Institutional Investors............................................................. 68 5.5 Retention Incentive .................................................................................................................... 68 5.6 Allocation of the Net Proceeds earned through the Sale of Existing Shares.............................. 68 5.7 Information on the Underwriting Agreement............................................................................. 69 6. Rights of Shareholders ....................................................................................................................... 72 6.1 General notes.............................................................................................................................. 72 6.2 Special Rights of Shareholders or Third Parties ........................................................................ 73 6.1.1 Greek State ......................................................................................................................... 73 6.1.2 Third Parties ....................................................................................................................... 74 6.1.3 Effect of the relevant Provisions ........................................................................................ 74 6.3 Minority Rights .......................................................................................................................... 74 6.4 Dividend Collection ................................................................................................................... 76 6.5 Dividend Taxation...................................................................................................................... 76 7. Information on the Company ............................................................................................................. 78 7.1 General Information ................................................................................................................... 78 7.2 History of the Port...................................................................................................................... 79 7.3 Description of the Port ............................................................................................................... 81 7.1.1 Passenger Traffic Services Port (Central Port and Salamina – Perama Coastal Ferry Line) 81 7.1.2 Commercial Traffic Services Port...................................................................................... 82 DRAFT 7 # 09/07/03 2 Admission of PPA S.A. Shares to the Main Market of the Athens Exchange 7.4 Company Activities.................................................................................................................... 88 7.1.1 Nature of Activities ............................................................................................................ 88 7.1.2 Procedures for the Provision of Port Services.................................................................... 89 7.1.3 Description of Activities .................................................................................................... 91 7.5 Procurement Regulations ......................................................................................................... 103 7.6 Tariff Policy ............................................................................................................................. 103 7.7 Contracts for Works ................................................................................................................. 104 7.8 Contracts for Services .............................................................................................................. 107 7.9 Co-operation – Joint Venture Arrangements............................................................................ 108 7.10 Contracts with Important Customers.......................................................................................