Greece is beginning to find new life for its plans to bring an integrated resort (IR) to the Mediterranean island nation. The signing of an agreement will now allow the project to move forward.
The Greek Finance Ministry announced Wednesday that it reached a concession agreement with Gek Terna and a consortium of companies. This was a crucial step in the development of Ellinikon’s first IR.
On behalf of the government, Finance Minister Christos Staikouras signed the concession. It gives Athens IRC, consisting of MGGR LLC and MGE Hellinikon BV, the 30-year license for the development and management of the casino.
This includes the construction of a 5-star hotel with 3,450 beds and a conference and exhibition center. It will also include a complex that can host 10,500 people for sports and cultural events.
IR Still Years Out
In the next period, the consortium will present its revised plans for the €1.1-billion (US$1.17 billion) investment. Construction will take at least 36 months once things get underway.
The project will boost tourism to Athens and Attica and increase state coffers by a minimum of 10%. Once it is ready for business, the IR will also create thousands more jobs.
After US gaming giant Mohegan Gaming & Entertainment (MGE) withdrew from the project, Gek Terna became the sole developer and operator for the ambitious INSPIRE Athens resort. MGE’s exit left 65% of the project’s share in the air, but Gek Terna stepped it. It originally held 35% of the bidding consortium’s success and then purchased all shares and appointed a new board.
Gek Terna will partner with Hard Rock Internationalto manage and operate the casino after they finalize their agreement. Local media reports that Hard Rock will take a 51% stake as part of the Gek Terna-led consortium.
George Peristeris, chairman and CEO of Gek Terna, stated that the company will work with its partners to create a “tourist and entertainment development project.” It will include the casino, a luxury hotel and top entertainment destinations. In addition, it will offer shops, restaurants and other attractive amenities.
He continued by saying that the casino project would “strengthen Athens’ place on the international tourism map.” It will also serve as a catalyst for growth, creating thousands of jobs and generating substantial revenue for Greece’s government.
Using Local Talent for Local Projects
Peristeris also highlighted the importance of Greek companies taking part in major projects. He asserted that it is “vital” for Greek companies to actively participate in large investments that are a gamble for the future of the company.
He didn’t reject the idea of using foreign investments, but added that Greek companies have an edge. They will be able to offer greater support in times of difficulty, and will better reflect the “prosperity” of the country.
The news helped Gek Terna find solid ground in trading. It recorded a rally of more than 3% in its shares on the Athens Stock Exchange, reaching almost €10.50 (US$11.18). This is the highest level in the last 15 years.
The upward move is mainly due to the scenarios for the progress of the negotiations. However, it is also the result of another big deal, which would see it sell shares of its Terna Energy subsidiary to the Macquarie Group in Australia.
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