PRIVATIZATION WATCH- Sodic goes on the offense on HHD tender, says conditions were untenable: Real estate developer Sodic decided against bidding for a 10% stake and management rights of Heliopolis Housing and Development (HHD) because the two companies did not see eye-to-eye on key matters, Sodic Managing Director Magued Sherif tells the local press. According to Sherif, the upscale real estate developer wanted stronger board representation once awarded the management rights for HHD, but the state-owned company was not on the same page. Sodic was one of four companies that had purchased the tender documents for the transaction, but ultimately did not submit a bid.

HHD counters that it did what it could to address investor concerns: HHD received over 150 questions and requests from the four companies and showed flexibility in making changes to the conditions of the tender, said Hesham Aboul Atta, the chairman of HHD’s parent company, the Holding Company for Construction and Development. Their decision to not present bids despite these changes was a “negative” message from the companies, he said.

Sodic is still open to the idea if the terms are changed, but HHD says the window is closed: If HHD makes key changes to the prospectus in a fresh tender, Sodic would be willing to submit a bid and is still interested in cooperating with the state-owned company under different terms, Sherif said. But Aboul Atta confirmed that offering the 10% stake and rights to manage the company was a one-time offer that will not be renewed. HHD is now looking to set a new development plan from within the company, which Public Enterprises Minister Hisham Tawfik will announce soon. The fate of the company’s secondary offering has yet to be determined, Aboul Atta said.

Market regulator probing stock dip: The Financial Regulatory Authority is looking into allegations that insider trading could have played a role in HHD stocks plunging 9.7% after announcing it received no bids for the 10% stake, the local press reports, citing informed sources. According to the sources, the dip actually began before HHD officially disclosed the results of the tender, and there was a bump in trading on HHD shares on 18 February. The sources allege that some brokers received an insider tip that one of the four companies would not submit an offer. HHD shares recovered 2% on Wednesday to reach EGP 17.18, after tumbling to EGP 17.01 on Monday, according to EGX data.