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Tuesday, 23 June 2020

Egypt looks to reach financial settlement with Saudi investor over Omar Effendi sale dispute

DISPUTE WATCH- Gov’t looks to reach financial settlement with Saudi investor over Omar Effendi sale dispute: The Holding Company for Construction and Development (HCCD) has proposed a financial settlement to Saudi’s Anwal United Trading Company in its dispute over the sale of HCCD subsidiary Omar Effendi, HCCD Chairman Hisham Aboul Atta tells Masrawy. HCCD is currently waiting on Anwal’s decision on the proposed settlement, Aboul Atta said, without disclosing details on the sum or terms offered.

Background: The state had agreed to sell a 90% stake in Omar Effendi to Anwal in 2006, only to have the Administrative Court issue a ruling in 2011 rolling back the stake sale. The ruling also scrapped other agreements the state had reached with investors, including one to partially privatize Nile Cotton Ginning. The decision drew Egypt into international arbitration entanglements, including a dispute with the World Bank’s International Finance Corporation (IFC) over a USD 40 mn loan Omar Effendi signed under the Saudi company’s management in 2007. Anwal stopped repaying the loan after the Administrative Court ruling. Omar Effendi eventually signed an agreement with the IFC in 2018 to settle the dispute.

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