ADQ reportedly in early stage talks for a stake in Delta Sugar
Does ADQ want a piece of Delta Sugar Company? Abu Dhabi sovereign wealth fund ADQ is reportedly in early talks with the government to snap up a 10-15% stake in the state-owned Delta Sugar Company, CNBC Arabia reports, citing unnamed sources. ADQ would buy shares owned by an existing shareholder, according to the news outlet. Information about the value of the potential sale wasn’t disclosed.
No offers received: The EGX-listed company has not yet received any acquisition offers, it said in a bourse disclosure (pdf) hours after the report surfaced. This is the second time in less than eight months that Delta has denied receiving acquisition bids by ADQ.
Could Delta be the latest to join Madbouly’s privatization program? The company isn’t on the government’s list of 32 companies in which the government hopes to sell stakes over the next year under its relaunched privatization program. State-owned entities hold almost 86% of the sugar maker, including the Egyptian Sugar and Integrated Industries Company’s majority 55.7% stake, according to the company’s 2022 report (pdf). The remainder are publicly traded on the EGX.
Performance indicators: The company’s bottomline more than doubled to EGP 850 mn in 2022 amid soaring global sugar prices, even as production dipped. Its topline grew c. 19% y-o-y to EGP 3.8 bn in 2022, up from EGP 3.2 bn in the previous year. DSC’s production of beet sugar fell 15% y-o-y in 2022, molasses production was down 21%, and fodder production fell 13%, according to the report.
Market reax: DSC’s share price remained more or less steady, dipping 0.1% to EGP 24.75 by yesterday’s close.