PPA reply to OMYLE and the Unions regarding the agreement for the provision of project management services for the operation of Pier I between PPA S.A. and PCT S.A.
The Management of PPA S.A., following the Press Release of OMYLE and the PPA Unions dated 6/4/2020, which we read with surprise, would like to inform about the following:
a) PPA S.A. signed an agreement for the provision of project management services with PCT S.A. which had been notified to the Greek Authorities (GEMI 23639 / 27-02-2020 and 31153 / 18-03-2020) and uploaded on the website of the Athens Stock Exchange and the PPA. This agreement was approved by the Board of Directors of PPA S.A. before it was announced, following the recommendation of the Administration Board.
b) The benefits of PPA S.A. from this agreement will be significant as it ensures the increase of cargo that will be handled at the Pier I by more than 30% annually compared to 2019 and this will be for the benefit of our staff too. It is easily understandable that this percentage is particularly high, bearing in mind the crisis in the trade worldwide caused by COVID-19 as well as the decline in the Cruise sector, coastal shipping and RORO.
c) Our Company, through the Deputy CEO and responsible for the Labor Dept. and the Manager of Administration & HR informed the Unions’ representatives on 6/3/2020, for the proposed Pier I Piraeus Container Terminal Organizational structure, while explaining the benefits of PPA S.A. from this agreement. The Pier I Piraeus Container Terminal Organizational structure which was presented to the Unions’ representatives is the same as the one circulated on 1st of April 2020, the day when the agreement between PPA S.A. and PCT S.A. was officially put into effect.
Therefore, the Company has fully fulfilled its obligations according to the PPA S.A. General Staff Regulation (article 11.e).
Finally, we have made clear to the Unions’ representatives through the Management representatives and we make it clear again, that this agreement does not involve any change in the employment status of the PPA S.A. employees.
Cosco’s “Piraeus Container Terminal” to Provide Project Management Services to Piraeus Port Authority for Operating Pier I
The Board of Directors of the company under the name “Piraeus Port Authority Société Anonyme” (hereinafter “PPA S.A.”) announces that at its meeting of 20.02.2020 it has decided to provide a permission, in accordance with article 100 par. 1 of Law 4548/2018, for the conclusion of a transaction of PPA S.A. with the company under the name “PIRAEUS CONTAINER TERMINAL S.A.” (hereinafter “PCT S.A.”), which is a related party to PPA S.A. In particular, PPA S.A. as a subsidiary of “COSCO SHIPPING (Hong Kong) Limited” and PCT S.A. as a subsidiary of “COSCO SHIPPING Ports Limited” are related parties within the meaning of Article 99 par. 2 (a) of L. 4548/2018, as ultimate subsidiaries of “China COSCO SHIPPING Corporation Limited” (“COSCO SHIPPING Group”).
The subject of the transaction will be the provision of project management services by PCT S.A. to PPA S.A. for the business operation of Pier I of PPA S.A. and the main points of the contract, which has been executed today, 01/04/2020, under usual commercial terms, are the following: PCT S.A. will provide to PPA S.A. a wide range of highly specialized services related to the operation of the PIER I Container Terminal, for the purpose of PPA S.A. to achieve:
(i) the overall utilization of the Piraeus Container Terminal resources,(ii) the increase of the total throughput of Pier I of the port of Piraeus,(iii) the improvement of the quality of services provided by PPA S.A. in the Container Terminal of Pier I.
The fee of PCT S.A. will be a fixed annual service fee of sixty seven thousand Euros (€ 67,000.00) plus VAT, plus an additional management fee of four Euros (€ 4) per move, for any moves that exceed the throughput targets agreed each time, which for the period from the signing of the contract until January 31, 2021 will be 650,000 TEUs, with PCT S.A. guaranteeing throughput for this period of not less than 500,000 TEUs. The term of the contract will be three (3) years from the date of signature, with the possibility of a written extension and the right to terminate upon prior written notice (thirty days for substantial reason, or six months for any other reason). The applicable law will be Greek, and any disputes will be settled by arbitration, in accordance with ICC Rules.
For providing permission for the above transaction, the Board of Directors of PPA S.A. considered the fairness opinion dated 19/02/2020 of the auditing firm “Audit Plus S.A. Auditors”, with SOEL Registry Number 172, as signed by the Chartered Accountant and Certified Auditor Gerassimos Anast. Zafeiratos with SOEL Registry Number 20901, which assesses that the transaction is fair and reasonable for the Company and its non-related shareholders, including minority shareholders, and explains the assumptions on which it is based, together with the methods used.
The PPA S.A. Board of Directors minutes dated 20.02.2020, accompanied by the fairness opinion, was registered in the General Business Registry (GEMI) on 27.02.2020, according to the announcement nr. 23639 of the department for supervision of Listed Sociétés Anonymes of the General Secretariat for Commerce & Consumer Protection.