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Thursday, 9 March 2023

Could investors submit bids for TE before Ramadan?

Could the gov’t field offers for up to 20% of TE in the next two weeks? The government reportedly hopes to wrap up a roadshow and receive offers for a 10-20% stake in national telecoms provider Telecom Egypt (TE) before the start of Ramadan, Hapi Journal reports, citing unnamed sources it says have knowledge of the matter.

REFRESHER- The Finance Ministry this week confirmed that it’s studying selling an undisclosed stake in TE, after Reuters reported that the government could part with 10% of the company. The state currently owns 80% of TE, while the remaining 20% is in freefloat.

A regional roadshow is reportedly underway: CI Capital, Al Ahly Pharos, and the National Bank of Egypt (NBE) are reportedly gauging interest among Gulf and other regional investors for the sale, per Hapi’s sources.

No more than 3% per new investor? The government will look to onboard several new investors to TE in a bid to diversify its ownership, capping each stake sale at no more than 3% of the company, according to the newspaper.

Market reax: TE’s share price gained 4.8% to settle at EGP 26.77 during trading yesterday, having fallen more than 8% on Monday and Tuesday this week.

The rumor mill has been in full swing since the news broke on Monday. Reuters’ original report had said that regional interest in TE was low and the sale would likely go to a local investor. The Finance Ministry has said it’s still studying the feasibility of the stake sale and may decide not to go ahead with it after all. The company could instead choose to securitize future receivables as an alternative means of raising capital, a source told Asharq Business earlier this week.

Advisors: Our friends at CI Capital are reportedly managing the transaction alongside Al Ahly Pharos, while NBE is also said to be involved as an advisor. The ministry is still scouting for legal counsel, media reports suggest.

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