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Tuesday, 23 April 2019

Heliopolis Housing out of first wave of stake sales; no stake sales during summer

EXCLUSIVE- Heliopolis Housing dropped from first wave of state privatization program: Heliopolis Company for Housing and Development has been dropped from the lineup of companies included in the first wave of the state privatization program, Public Enterprises Minister Hisham Tawfik tells Enterprise. This leaves Abu Qir Fertilizers and Alexandria Containers and Cargo Handling Company (ALCN) remaining in the first wave. Tawfik declined to disclose which of the two companies is up first, saying to do so could adversely impact the transactions. Both ALCN and Abu Qir are listed on the EGX; the upcoming transactions would accordingly be stake sales through accelerated book builds.

One more offering could land before Eid, but none during the summer: Abu Qir or ACCH could go to market before the Eid El Fitr break, but the sale program will definitely be on hold during the summer, when liquidity and trading volumes are typically low, the minister tells us. The state will be targeting foreign investors with the sales, Tawfik added, as it did with the transaction in March on Eastern Tobacco.

Background: The government kicked off the first wave of the program last month with Eastern Tobacco’s secondary offering of a 4.5% stake. Both Alex Containers and Abu Qir will be secondary offerings. Alexandria Mineral Oils Company (AMOC) had also been slated to go ahead in the first wave, but was sidelined earlier this year after an unexpected fall in profits. The first phase of the program was delayed last year as the emerging markets sell-off hit the EGX. The ambitious program had an initial line up of 23 companies slated either for IPO or for a secondary offering.

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