ATHENS, Greece (AP) -- Greece's conservative-led government on Wednesday announced plans to break up the state-run Public Power Corporation by 2016, as part of a privatization program demanded by the crisis-hit country's creditors.
Government spokesman Simos Kedikoglou said that about 30 percent of PPC's resources would be spun off to create a rival company, while the company-owned transmission operator, Admie, would also be sold.
The government is planning to sell off a 17 percent stake of PPC after the breakup, leaving it with 34 percent of company and powers to veto decisions, Kedikoglou said. It will also retain a minority stake in the transmission operator.
"Careful consideration will be made for staff. There will be no dismissals," Kedikoglou told state-run NET television, insisting the privatization plan had the full backing of the government's left-wing and center-left coalition partners.
PPC employs about 20,000 people.
The main left-wing opposition party, Syriza, described the proposed sale as "looting," while a PPC union representing power station workers and lignite miners in northern Greece said it would do "everything in its power to block the sale."
Shares in PPC rose 7.5 percent in Athens on Wednesday, with investors also buoyed by a sovereign rating upgrade by Fitch late on Tuesday. The main Athens index closed up 3.7 percent.
Greece's rescue lenders -- its euro partners and the International Monetary Fund -- have been pushing the government to speed up its privatizations campaign, one of the conditions for the bailout loans it has been receiving since 2010.
The government has promised the economy will grow gain and the state will once again borrow from bond markets next year. Greece's borrowing rates have improved steadily over the past year, with the interest rate on 10-year bonds falling from 30 percent in June, when the ruling coalition was formed, to just over 9 percent.
But austerity measures continue to hammer the economy. The Greek Statistical Authority reported Wednesday that economic output shrank 5.3 percent in the first quarter compared with a year earlier.
Rescue lenders are also demanding faster progress in dismantling market licensing restrictions and are pressing for the mass dismissal of civil servants -- triggering a new round of strikes this month.
On Wednesday, high school teachers' union members met to vote on whether to defy an emergency government order that would prevent them from holding rolling strikes from Friday. Teachers risk arrest if they press ahead with the strike, which would severely disrupt annual university entrance exams.
In central Athens, striking farmer's market vendors handed out fruit and vegetables for free to hundreds of consumers. On Thursday, air traffic controllers plan to ground all flights for four hours from midday.