Privatization activities on the rise
Egypt, Economics, 12/22/1999

Despite the slow rhythm of economic activities during the fasting month of Ramadan, yet Egypt's privatization drive is gaining full force with a host of new capital inflows channeled into the State's treasury.

This has been clearly manifested in the recent sale of 73.6 per cent of Alexandria Cement Company to the British Blue Circle Cement Company with a total value of L.E. 589.1 million and a per share price of L.E. 80.

Minister of Public Business Sector Mokhtar Khattab said that under the sales deal, the British Company is committed to maintain the labor rights of the Alexandria Cement, rehabilitate and train its workers along with retaining the Company's industrial activity in the field of cement production.

New investments are to be pumped to develop the Company and transfer latest technological methods. Up till the end of June 30, 1999 Alexandria Cement Company realized net sales worth L.E. 189.7 million whereas profits hit L.E. 82.6 million.

It is note-worthy that this is the third major privatization deal to be concluded in the cement sector this year. The first was the sale of Beni Sweif Cement to the French "Lafarge" Company, followed by Assiut Cement which was purchased by "Cemex" of Mexico.

Moreover, an agreement has been recently signed to sell 90 per cent of the Industrial Gases Company to an anchor investor worth a total of L.E. 60 million, three-fold its book value along with maintaining a 10 per cent rate for the Shareholders' Workers Federation.

The anchor investor will extend L.E.100 million in new investments to develop and update the companies' plants according to latest methods of modern technology besides maintaining labor's full rights.

The Holding Company for Chemical Industries has received three offers to buy shares ranging from 30 to 90 per cent of the Egyptian Company for Plastics and Electricity, whereas the remaining 10 per cent of the Company's shares will be offered for sale to workers.

The sale offers were submitted by a consortium of Saudi and Gulf state investors along with other offers by Egyptian investors.

The Company's aggregate sales hit L.E. 100 million annually with a distributed surplus of L.E. 15.01 million in 1998/99 as compared to L.E. 40.760 in 1995/96.

Moreover, the Holding Company for Housing, Tourism and Cinema decided to float 25 per cent of El-Maamourah Housing and Reconstruction Company for public subscription. A number of five-star floating hotels will also be offered for public sale this month, according to an official source at the Holding Company.

Previous Stories:
  Fitch IBCA lauds Egypt's economic stability   (12/21/1999)
  15 Egyptian companies to be raised for sale soon   (11/6/1999)
  Ghali: Egypt is one of the most attractive rising markets   (9/16/1999)
  Egypt making progress in privatization program   (8/25/1999)

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