Marfin Investment Group Nearing Close on Olympic Airlines

(Reuters) – Greece’s biggest buyout company Marfin Investent Group expects to close a deal to acquire the troubled Olympic Airlines from the Greek government this week, a senior MIG official said on Tuesday.

A deal to sell the loss-making carrier will end strains on the government’s budget and wrangling with the EU over illegal subsidies.

MIG came forward in early February after an international tender expired in January without satisfactory offers.

“We are close to a deal, which is expected to be finalised this Thursday at a meeting with government representatives,” the MIG source said.

A government official, who declined to be named, also told Reuters the two sides were close to reaching a deal.

“There is no other candidate buyer for the flying operations of Olympic,” said the official, who declined to be named.

The government appealed to Greek businesses last month to step in after a tender to privatise the ailing carrier failed to attract big names or high bids as the global crisis hits the airline sector.

Greece has wrangled for years with Brussels over state aid to Olympic. Its latest attempt to sell the airline was approved by the European Commission, which agreed to suspend action over illegal state aid if the sale went ahead.

Athens split Olympic into three units — flying, ground handling and aircraft maintenance — last September to facilitate the sale.

Marfin submitted a 45.7 million euro bid in mid-February for Olympic’s flying operations and 16.7 million for its technical base, the government said. Swissport, a subsidiary of Spain’s Ferrovial (FER.MC: Quote, Profile, Research),bid for the ground handling unit.

Founded in 1957 by the late shipping tycoon Aristolte Onassis, Olympic steadily declined after decades in state hands. (Reporting by Lefteris Papadimas; Writing by George Georgiopoulos; Editing by David Holmes)