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Thursday, 14 October 2021

THIS EVENING: OC-led consortium to implement Ras Ghareb wind farm + Egytrans pulls the brake on HAUH takeover offer ALSO: Regini trials unfold

Well, friends, we’ve made it through another workweek together, and our reward is not just a weekend, but the promise of a four-day workweek next week. We have a ton of news to get through before we can shift our brains into something approximating neutral, so as we did this morning, let’s jump straight in:

THE BIG STORIES TODAY-

#1- OC-led consortium lands new Ras Ghareb wind farm contract: An Orascom Construction-Toyota Tsusho-Engie consortium will develop, construct and operate a 500 MW Ras Ghareb wind farm on a 20-year contract (pdf).

#2- SFE, Fertiglobe, Scatec agree on green hydrogen plant: Norwegian solar company Scatec has entered an agreement with the Sovereign Fund of Egypt and Nassef Sawiris-backed Fertiglobe to develop a new 50-100 MW green hydrogen plant in Ain Sokhna.

#3- Egytrans pulls the brake on HAUH takeover offer: Egytrans is “no longer considering” an offer from Hassan Allam Utilities Holding to acquire a controlling stake in the company after the two sides apparently failed to agree on a fair value (pdf).

#4- Korea is lining up what seems to be a multi-bn USD infrastructure and defense sale to Egypt. Korean media report (here and here) that National Assembly Speaker Park Byeong-seok discussed with President Abdel Fattah El Sisi this week a package of contracts that could include:

  • A shipyard construction contract in the Suez Canal area for Samsung Heavy Industries;
  • An additional order from the Cairo Metro for Hyundai Rotem;
  • Unspecified technical support for the Dabaa nuclear power plant that’s now on the drawing board;
  • The sale of Korea’s self-propelled K9 Thunder howitzer to the Egyptian Armed Forces.

#5- Egypt’s inclusion in JPMorgan’s EM government bond index could drive inflows worth USD 1 bn to Egypt’s local currency bond markets, Finance Minister Mohamed Maait said in a statement this morning. This is a more conservative figure than the USD 1.4-2.2 bn of passive inflows research analysts at JPMorgan have previously estimated could be generated from being included in the index. Our sovereign debt is expected to be back in the JPM index starting in January, we reported this morning.

** CATCH UP QUICK on the top stories from today’s EnterpriseAM:

  • One on one with Kouchouk: In Part 1 of our two-part interview series, Vice Minister of Finance Ahmed Kouchouk walks us through how 2022 could be a big year for Egyptian debt.
  • Egypt’s budget deficit is still on track to narrow through FY2025-2026, but at a slower pace than previously expected, the IMF said in its latest Fiscal Monitor Report.
  • A strategic investor aims to take 10% of e-Finance’s ongoing IPO, according to a domestic media report. The IPO was priced at EGP 13.98 per share (the top end of the range) as the institutional offering wrapped up. Retail investors have until Sunday to get their orders in.

HAPPENING NOW-

Egypt and Greece are set to sign today an agreement to build a subsea cable through which Egypt will export power to Greece. The pact is part of the EuroAfrica Interconnector project, which is set to link the electricity grids of Egypt, Greece, and Cyprus.

Four Egyptian security service officials are standing trial in absentia today on charges stemming from the murder of Italian graduate student Giulio Regeni. The Regeni killing has been a sore spot in Egypt-Italy relations since 2016. Reuters and Deutsche Welle have the story.

President Abdel Fattah El Sisi spoke to Prime Minister Boris Johnson ahead of the upcoming COP26 summit, according to a release from the UK government. After vowing that the two countries would work together to make the event a success, Johnson urged Cairo to commit to halting new use of coal and come forward with a Nationally Determined Contribution to cut emissions. The two leaders also discussed defense and security cooperation as well as Libya’s elections.

Just in time for the climate change conference, demand for fossil fuels is looking to soar, with the International Energy Agency saying in its monthly market report that the natural gas and coal shortages will cause manufacturers to switch to oil, pushing up prices. The agency predicts that the redirected demand could translate into as much as 500k bbl/d through 1Q2022, according to the Wall Street Journal. The report’s release nudged up oil prices this morning, with Brent crude futures rising 1.1% and WTI crude futures also inching up 1%, according to Reuters.

European stocks are comfortably in the green right now, and futures suggest Wall Street will soon follow suit at the opening bell.

At least six people are dead and 30 wounded after gunfire broke out at a protest in Beirut against the lead investigator into last year’s deadly port blast. Follow the Lebanese Red Cross on Twitter for the latest updates.


HAPPENING NEXT WEEK-

Retail investors have until Sunday to get their orders in for shares of e-Finance. Shares of the state-owned fintech platform and payments infrastructure provider should start trading next week on the EGX as one of the largest IPOs in recent memory wraps up.

It’s a four-day workweek as the nation takes Thursday, 21 October off in observance of the Prophet Muhammad’s birthday. It’s our last holiday until the end of the year, so make it count.

IT WILL BE A BIG WEEK FOR … the tech nerds among us. Apple is expected to announce new (redesigned) MacBook Pros on Monday at 7pm CLT (stream it here), while Google will hold an event on Tuesday to talk about its Pixel 6 and Pixel Pro phones (stream it here at 7pm). Apple is also widely expected to announce new, redesigned AirPods.

A SIGN OF THE TIMES straight from the dumpster fire that is our social media: “I have lived long enough to see Fonzie wish Captain Kirk well on his trip to space on my pocket computer. Ten year old me just exploded.” (Brittlestar on Twitter)

THE BIG STORY ABROAD- No single story dominates the front pages of the global business press on this final workday of the week. Of local interest: The Financial Times is onto the TRY hitting a record low after Erdogan sacked central bank officials, as we reported this morning — and Bloomberg thinks that the TRY is now “the currency to short as Erdogan fuels rate-cut fears.” The Wall Street Journal is leading with an exclusive claiming Boeing’s 787 Dreamliner has yet another defect, while Reuters is running with Price pinch: global economy caught in perfect storm.

The good news for major US banks continued today as Bank of America reported a 58% year-on-year rise in net income in 3Q2021, beating analysts’ predictions, according to the WSJ. JPMorgan Chase also beat analyst expectations with its 3Q results out yesterday. Expect Citigroup and Morgan Stanley to report today and Goldman Sachs to follow suit tomorrow.

US tech startups have raised a record-breaking USD 582.5 bn YTD from IPOs or agreements with SPACs, the Financial Times reported using data from PitchBook. The number of listings picked up in 3Q2021, with 93 IPOs going to market during the period. In response, investors and VCs are lining up for huge gains this year, especially as exits are on the rise and VC dealmaking has increased 40% this year compared to 2022.

📆 CIRCLE YOUR CALENDAR-

The El Gouna Film Festival kicked off today and will run until 22 October. This edition of the event promises to bring together a selection of international narrative, documentary, and avante garde films. You can check out the full program here.

Conference season ratchets up this month, with a number of exhibitions and business events here and throughout the region taking place this week, including:

  • The Turathna Exhibition at the Egypt International Exhibition Center, Cairo, which will run until tomorrow.
  • The GITEX Global is being held in the Dubai World Trade Center from 17-21 October. The event brings together players in Big Tech to discuss what’s next in areas such as AI, cloud, 5G, cybersecurity, blockchain, and more.
  • Further down the road: The Middle East Angel Investment Network is hosting its Angel Oasis in El Gouna on 27-29 October, with separate pricing for in-person and virtual attendance.

☀️ TOMORROW’S WEATHER- We’re in for a sunny Friday (with a high of 34°C) and a cloudy Saturday (high of 35°C). Look for an overnight low of 21 both days, our favorite weather app tells us.

Enterprise is a daily publication of Enterprise Ventures LLC, an Egyptian limited liability company (commercial register 83594), and a subsidiary of Inktank Communications. Summaries are intended for guidance only and are provided on an as-is basis; kindly refer to the source article in its original language prior to undertaking any action. Neither Enterprise Ventures nor its staff assume any responsibility or liability for the accuracy of the information contained in this publication, whether in the form of summaries or analysis. © 2021 Enterprise Ventures LLC.

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