Thessaloniki, Greece (Ports Europe) December 24, 2021 – Thessaloniki Port Authority (ThPA) has reported that Belterra Investments Ltd., owned by a Russian billionaire of Greek origin, Ivan Savvidis, has acquired a further 489,332 shares in ThPA corresponding to 4.85% of total voting rights.
Belterra owns a total of 7,242,932 shares and voting rights in ThPA, both directly and indirectly in South Europe Gateway Thessaloniki (SEGT) Ltd (which holds 67% of ThPA’s shares and voting rights). Thеsе 7,242,932 shares corresponds to 71.85% of its total paid-up share capital.
Thessaloniki Port Authority (ThPA) was privatised in March 2018, and is operated by SEGT Ltd, a consortium, in turn, then (in 2018) owned by Germany’s Deutsche Invest Equity Partners (DIEP) 47%; France’s CMA CGM (Terminal Link) 33% and Savvidis Group (Cyprus-registered Belterra Investments) 20%.
The only other remaining member of SEGT Lt. today is France’s CMA CGM (Terminal Link, owned 100% by Terminal Link SAS) 28.15%. Terminal Link is 49% owned by China Merchants Port Holding, which is controlled by the Chinese state.
All this cements the control by proxies of Russia and China of Greece’s second largest port, a strategic gateway for Northern Greece, landlocked North Macedonia, Kosovo and Serbia, and further, via Danube river, into Central Europe. This has raised concerns in the European Union (EU) and the USA, and the port has become the subject of wide geopolitical interest.
The Chinese government continues to invest in port facilities as part of its new Silk Road policy, and already controls, via its COSCO Shipping Ports Limited, Greek largest port of Piraeus. At the same time, Russia has been trying to develop its political and business links to the Balkan and central European countries which were previously under the hegemony of the former Soviet Union.
The Russian tsar of Thessaloniki
In February 2021, Russian billionaire of Greek origin, born in Georgia, Ivan Savvidis, acquired the 47% stake in the port owned by DIEP. According to local media he already owned 20% and the new acquisition increased his shareholding in ThPA to 67%.
Savidis (Savidi, Savvidis), “the Russian tsar of Thessaloniki”, according to local media, has been embroiled in numerous scandals and controversial situations in recent years. The owner of the Greek PAOK football club, hotels and a former member of the Russian State Duma, according to an investigation, has transferred hundreds of thousands of euros to structures working against a change of the name of neighbouring Northern Macedonia. He also participates in the manufacture of cigarettes and sugar and is seen as one of the most powerful investors in Northern Greece.
Savidis’ name appeared in publications about the coup attempt against Montenegro then-Prime Minister Milo Djukanovic in 2016. Some time ago, he went to a football pitch with a gun during a match featuring his own football team. Russian President Vladimir Putin, with whom he has cordial relations, awarded him in 2019 the order of “many years of conscientious work” and “achievements in labour”.
Thessaloniki Port
In November 2020, Thessaloniki Port Authority (ThPA) started a hinterland expansion with its first intermodal terminal (dry port) in the capital of neighbouring Bulgaria (in Iliyantsi/Ilianci, Sofia). The dry port, to controlled by the subsidiary ThPA Sofia, is part of the port’s strategy to become a gateway to the Balkan region. It is located 230 km north of the port and will be linked by train directly to the Port of Thessaloniki, providing competitive transit times and costs.
The new dry port aims to become an important trade hub and a modern development centre, which will be linked by train with a range of dry ports in South-Eastern, Eastern and Central Europe, playing a decisive role in strengthening the export activities of a wide range of businesses, according to a Port of Thessaloniki statement.
SEGT paid €232 million ($287 million) for the port, but the full benefit of the deal for Thessaloniki Port Authority SA (ThPA) will amount to €1.1 billion ($1.36 billion) as it also includes the consortium’s commitment to invest €180 million over the next seven years, capitalising on the port’s location as an export gate for the wider Balkan area. The SEGT consortium members have agreed to spend €650 million on upgrading the port’s facilities over the 34-year concession period. The facilities have not had a major upgrade since the 1990s.
The main focus of the €180 million investment in the port of Thessaloniki, expected to be completed ahead of schedule for under five years, is the extension of the container terminal by 440 metres and dredging works that will increase the port’s depth to 16.5 metres, which is strategic in providing a berthing place to accommodate so-called New Panamax vessels especially the ships coming from East Asia.
The port also plans to develop a freight centre, to be tendered by Greek state-owned railway property management and development company GAIAOSE, and the cruise tourism sector. It has already been announced that a new area of 26,000 m² will be available for the temporary storage of containers to be exported, which is part of the gradual redesign of the overall operation of the container terminal and of the new investment program.
Of the investment, €130 million has been allocated to 6th Pier projects, €30 million to equipment for the container station and the dry cargo facility and €20 million for static reinforcement at the old customs office, as well as other port development projects. Improved facilities will enable the port to handle larger vessels and thus increase container volumes.
The agreement does not include the sale of port infrastructure, which has been leased to the Thessaloniki Port Authority via a concession until 2051.
The port of Thessaloniki is of prime strategic importance for the North Atlantic Treaty Organisation (NATO), as well as the Russians and the EU. It is the connecting link between Asia and Europe, by-passing the Turkish Straits (Bosphorus).
Controversies
Not much attention was paid even by the specialised media on Chinese involvement in the privatisation of both Piraeus, Greece largest, and Thessaloniki ports. But even less information was published about the Russian link in the privatisation of the Port of Thessaloniki – Belterra Investments, owned by billionaire Greek-Russian Ivan Savidis.
He is considered to be from the inner circle of Russian President Vladimir Putin, alleged to have tried to influence government policy and is said to have the ear of the former Greek Prime Minister and radical left SYRIZA leader Alexis Tsipras.
Savidis, 63, who made his fortune in agriculture and tobacco in southern Russia, had an arrest warrant (but has never been detained) issued against him for bringing a gun onto the soccer field to protest a referee’s decision.
Over the past decade, Savidis has invested in northern Greek businesses, some on the brink of collapse, as well as in media – television stations and newspapers – that are generally supportive of SYRIZA. Allegedly, he has been using his wealth and connections, despite not being fluent in Greek, to carry out what critics describe as double-dealing for Russia.
Media publications, that cannot be independently verified, claim that Savidis seems to have a lot of influence in Thessaloniki, and that U.S. and Greek officials believe he’s a straw man for Russian President Putin’s interest in the country and the Balkans.
The New York Times newspaper said that U.S. officials in June intercepted communications showing Savidis was working as Russia’s agent to undermine the name deal with the Former Yugoslav Republic of Macedonia (FYROM), which the West strongly backed to gain entry for what would become North Macedonia into NATO as a bulwark against growing Russian interests in the Balkans.
A senior U.S. official told the New York Times that U.S. agencies were able to easily collect financial data that put Savidis behind payments to citizens and soccer fans to incite violence against the FYROM referendum for the country’s name change.
According to the Organized Crime and Corruption Reporting Project, an investigative reporting organisation, Savidis paid opponents of the campaign to rename FYROM at least €300,000. Savidis strongly denied all charges. He was a member of Putin’s party, United Russia, when he was in the Duma, the lower House of Russia’s Parliament.
ThPA performance in 2020
Thessaloniki Port Authority (ThPA) has published in May financial results of fiscal year 2020, reporting increased revenues and operational profits compared to 2019.
| Amounts in (€ ‘000) | 2019 | 2020 | Variation (%) |
| Financials | |||
| Total Revenue: | 68.981 | 71.724 | 4.0% |
| Container Terminal | 44.681 | 49.730 | 11.3% |
| Conventional Cargo Terminal | 22.286 | 20.221 | -9.3% |
| Facilities Rentals | 1.871 | 1.582 | -15.4% |
| Passenger Traffic | 143 | 191 | 33.6% |
| Gross Profit | 32.204 | 33.906 | 5.3% |
| Gross Profit Margin (%) | 46,7% | 47,3% | |
| EBITDA | 29.748 | 30.922 | 3.9% |
| EBITDA Margin (%) | 43,1% | 43,1% | |
| Net Profit after tax | 16.453 | 20.084 | 2.1% |
| Net Profit Margin (%) | 23.9% | 28.0% |
In 2020, the activity level in volumes increased for the Container Terminal (CT) and decreased for the Conventional Cargo Terminal (CC), compared to 2019:
| 2019 | 2020 | Variation (%) | |
| Volumes | |||
| Container Terminal (in 000’s TEUs) | 449 | 461 | 2.7% |
| Conventional Cargo Terminal (in 000’s Tons) | 4.469 | 3.741 | -16.3% |
| Vessel calls: | 1.347 | 1.286 | -4.5% |
| Container vessels | 463 | 489 | 5.6% |
| Conventional cargo vessels | 832 | 721 | -13.3% |
| Passenger vessels | 52 | 76 | 46.2% |
Net profits were significantly influenced positively by two main factors, the positive change in the total depreciation charges to certain machinery by €0.88 million and the reversal of tax provisions by €1.42 million, the latter as a positive result of the favourable recent decision from the Administrative Court of Appeal regarding tax audits for the years 2005-2011.
Further on and additional to the recent corporate announcement regarding the 2020 Financial Statements, certain key highlights were presented:
- ThPA S.A. maintains a cash position able to finance current OpEx and a significant part of the total CapEx needs, in tandem with future Debt Financing, when needed. Remains Debt free.
- Cash & cash equivalents as of 12/2020 reached ~ €105 million (including term depos) compared to ~ €99 million in 2019.
- Proposed dividend, subject to approval by the forthcoming Annual General Meeting of 2020 is €1.42/share compared to €1.17/share of previous year.
- Future dividend policy aims to continue providing satisfactory dividend payouts, considering however the need to finance the largest part of its significant Investment Plan.
The Management of ThPA S.A. is focused on a series of new implementations, indicatively:
- Improving the level of service of the Port as a prime facility for conventional cargo and further strengthen the leading role of Thessaloniki in the Eastern Mediterranean.
- New investments for the expansion of Pier 6, that will allow servicing Post Panamax vessels of up to 24k TEUs (currently servicing New Panamax vessels up to 8k TEUs) and attract mainliner services, according to the new market conditions.
- New TOS (Terminal Operation System) software installation for the Container Terminal to significantly improve operational efficiency.
- Expansion in progress of the Free Zone Area.
- Further improvement of the customer-oriented culture.
- Develop the so-called “beyond the Port” activities: integrate the Port of Thessaloniki in the supply chain logistics, by providing intermodal solutions to & from the main Balkan Countries. To this end, new subsidiary (100% owned) was incorporated in Sofia in November 2020, “ThPA Sofia EAD”, while more subsidiaries are expected to be established within the near future.
Regarding the negative effects of the pandemic, the Container Terminal volumes in the first quarter of Q1 2021 saw a mild throughput increase of 2.6% compared to Q1 2020, while the Conventional Terminal volumes decreased by 7.6%, compared with the same period of Q1 2020.
Regarding capital expenditure plan, ThPA S.A. has completed significant investments of €38.2 million since its privatization (March 2018) until May 2021, while additional investments exceeding €25 million are expected to be executed during 2021 and the beginning of 2022.
For more information about the controversial Russian and Chinese involvement in the Port of Thessaloniki, read our analysis Thessaloniki port seeks exit from Piraeus shadow; Chinese and Russian interests.
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