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Tuesday, 18 September 2018

Egypt on track to sell stakes from five state-owned companies before year’s end, share prices to range within 10% of market average

IPO WATCH- Five state companies to tap capital markets by year’s end, offerings to be priced within 10% of market: The offer price for the five state-owned companies that will sell additional stakes on the EGX over the coming three months will be set within 10% of the trailing market average, Public Enterprises Minister Hisham Tawfik said yesterday, Reuters reports. AMOC is expected to pilot the first wave of the privatization program next month, followed by Eastern Company in October, as well as Heliopolis Housing, Abu Qir Fertilizers, and Alexandria Containers & Cargo Handling before the end of the year.

The second phase of the privatization program should run six-nine months, Tawfik added. A number of companies are expected to float shares on the EGX for the first time as of the start of 2019, including energy contractor Enppi. State-controlled electronic payment solutions services provider E-Finance, which is among the 23 companies listed in the state privatization program, is also in line for an initial public offering in late 2019, Chairman and Managing Director Ibrahim Sarhan tells Amwal Al Ghad in an interview. No further details were provided. Tawfik, however, added that the government is also trying to raise EGP 27 bn from the sale of land belonging to 11 cotton gins. He made no mention of the date or timeline for the transaction.

Who’s advising? Expect an official announcement in two-three day’s time with the name of the legal counsel for Eastern Company’s stake sale, a spokesperson for NI Capital told us yesterday, saying that no final decision has yet been made. A senior Finance Ministry official told us earlier this week that law firm Matouk Bassiouny has been tapped for the job.

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