IPO WATCH- Eastern Company to sell additional stake on the EGX after Eid Al Fitr: The Eastern Tobacco Company will be the first state-owned enterprise to float additional shares on the EGX under the government’s privatization program immediately after the Eid Al Fitr break (which ends around 17-18 June), Public Enterprises Minister Khaled Badawy told the press yesterday. The government expects to raise around EGP 2.5 bn from the sale of 4% of the Chemical Industries Holding Company’s (CIHC) stake in Eastern, Badawy said.

The sale could be split in two stages, each offering 2% of the company’s shares, CIHC boss Emad El Din Mostafa tells Al Mal. The offering will be priced at the average share price in the one-month period immediately after the company’s board of directors approved the transaction, he adds. Badawy had announced on Monday that Eastern Company’s board signed off on the sale, the proceeds from which will be used to fund the restructuring of other companies in CIHC’s portfolio. The move would ensure the CIHC retains a 51% stake of the tobacco-maker, with 49% in free float.

Background: The Ismail Cabinet had announced earlier this month that the government was hoping to raise as much as EGP 15-18 bn from the first phase of the privatization program, which will run from June to end of 2018 or early 2019, and see four-six state-owned petroleum and petrochemical industries companies offer additional stakes and list new shares on the EGX. A cabinet committee that includes the ministers of investment, finance, petroleum, and public enterprises is overseeing the privatization program, candidates for which include some 23 companies.