The European Union said Tuesday it approved the sale of Greece’s debt-ridden state carrier Olympic Airlines to the Marfin Investment Group.
The deal announced Friday is expected to earn the Greek state euro 177 million ($225 million).
The EU Commission said Tuesday that the deal was permissible because it was done at market prices through direct negotiations.
Friday’s decision was made following three weeks of negotiations with Marfin, a Greece-based investment holdings company. In picking the company, the Greek state advisers rejected a bid from Olympic’s main domestic rival, Aegean Airlines, and U.S.-based Chrysler Aviation.
The Commission said that the planned privatization would offer the best chance to recover some euro850 million ($1.1 billion) in illegal state subsidies given to the airline and its predecessor over the past years.
Last year, the Commission wanted the privatization to be granted through a public tender but the financial crisis made sure none of the offers matched expectations. It was the sixth effort to privatize the troubled airline.
On Tuesday, the Commission said in a statement the new plan through direct negotiations with investment groups “does not give rise to state aid concerns.”