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The Great Trap - Extremely provocative €9.3 billion GEK TERNA borrowing poses a systemic bomb for Greek banks

GEK TERNA debt Greek banks Attiki Odos Egnatia Odos tags :
The Great Trap - Extremely provocative €9.3 billion GEK TERNA borrowing poses a systemic bomb for Greek banks
GEK TERNA's €4.1 billion debt in misinformation press releases... in reality stands at €9.3 billion
GEK TERNA's loans constitute an extreme systemic bomb for Greek banks, as bankingnews (BN) reveals that while GEK TERNA advertises a net debt of €4.1 billion in its press releases, in practice it exceeds €9.3 billion and the debt-to-EBITDA ratio (earnings before interest, taxes, depreciation, and amortization) stands between 10 to 12 times... astronomical numbers that resemble bankrupt companies abroad or entities potentially on the verge of default and corporate bankruptcy.

How is the GEK TERNA group's debt structured?

  1. Letters of guarantee of €1.9 billion (written commitment from banks)

  2. New loan for the Northern Road Axis of Crete (BOAK) of €1.4 billion

  3. Loan for Attiki Odos of €2.60 billion

  4. Loan for Egnatia Odos of €1.039 billion

  5. Loan for Nea Kentriki Odos of €391 million

  6. Kastelli, public-private partnerships (PPP) for water, waste, HERON, TERNA Construction, and other operational activities.... total loans of €644 million

  7. Parent company loans of €1.345 billion Total sum of loans: €9.3 billion This analysis does not include non-consolidated participations, as in that case the overall borrowing increases even further. GEK TERNA's €4.1 billion debt in misinformation press releases... in reality stands at €9.3 billion.

How is the GEK TERNA group valued?

Let us assume that GEK TERNA's annual EBITDA amounts to €700 to €730 million, which implies that GEK TERNA's leverage ratio stands at €9.3 billion divided by €730 million EBITDA, or 12 times, and 10 times EBITDA excluding letters of guarantee.

The critical questions

  1. Question to the management of the 4 major systemic banks—National Bank of Greece, Alpha Bank, Eurobank, and Piraeus Bank... do they feel comfortable having lent €9.3 billion, including letters of guarantee, to the GEK TERNA group?

  2. The banks have loaded themselves—literally—with the risk stemming from loans in concessions, and what is happening with bond loans containing cross-default clauses?

  3. Did the SSM, the Supervisory Board of the ECB, when visiting Greek banks and meeting management, raise the issue of Greek banks' exposure to large corporate groups, yes or no?

  4. Can it be explained how a company with a P/E ratio (Market cap of €5 billion to €170 million earnings in 2026) of nearly 30... receives substantial bank loans from Greek financial institutions?

  5. GEK TERNA states that it maintains cash reserves of €2.2 billion, but let us compare that with the big picture of the group's debt obligations standing at €9.3 billion... Although what we are about to mention is not common practice... if the cash reserves were wiped out today to repay the debt... the loans still could not be fully paid off... This serves as proof that GEK TERNA's borrowing is extremely... dangerous for the systemic stability of banks and represents a monumental financial risk for the GEK TERNA group itself.

A giant with feet of clay

In the end, how has GEK TERNA—presented as a giant in construction and concessions and a company closely linked to the Maximos Mansion—managed to control all motorways in Greece by borrowing €9.4 billion? Is it ultimately a giant with feet of clay, or, more accurately, are investors ignoring the true magnitude of the risk hidden within GEK TERNA?

BN will scrutinize every single project and concession, because initial research reveals a massive negative surprise... starting with Attiki Odos... Shocking revelations are coming in upcoming reports.

www.bankingnews.gr

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