National Investment Bank subsidiary NI Capital is preparing to sell stakes in seven state-owned companies as part of the government’s privatization program, two of which are expected to be complete by the end of the fiscal year in June, NI Capital CEO Mohamed Metwally told CNBC Arabia yesterday (watch, runtime: 8:07). Stakes in the remaining companies will be sold before the end of the year, he said. Companies include those in the oil, petrochemicals, and transport sector, he added, refusing to disclose names.

The potential contenders: We already know some of the oil and petrochemical players that the state has flagged for privatization: ‎The Egyptian Ethylene and Derivatives Company (Ethydco), Egyptian Linear Alkyl Benzene (Elab), Helwan Fertilizers Company, the Egyptian Polypropylene and Polypropylene Company (EPP), the Egyptian Drilling Company (EDC) were all named by the government in February when it announced its rebooted privatization plans.

More companies enter the roster: Metwally said that some of the seven companies have been named in the 32-company program and some have not. “Some companies are being promoted to strategic investors,” he said, naming military-owned bottled drinks firm Safi and fuel retailer Wataniya.

NI Capital has helped to close one sale: The firm acted alongside CI Capital and Al Ahly Pharos as a financial advisor and bookrunner on last week’s sale of Telecom Egypt shares.

THE TELECOM EGYPT LOCAL / FOREIGN SPLIT-

We now know how many investors who bought into the TE sale were foreign: Just 9% of the investors who acquired shares in Telecom Egypt were foreign, Metwally said, leaving upwards of 90% of the shares going to local buyers. The government raised almost EGP 3.75 bn (USD 121.3 mn) when it sold a 9.5% stake in the state-owned telco last week in what was the first major asset sale since it announced its privatization plans earlier this year. The government is yet to reveal the identities of the new shareholders.

This means the FX proceeds were minimal: Because the transaction was done in EGP, the small number of shares sold to foreign investors means that the sale generated less than USD 11 mn in hard-currency proceeds, according to our math.

Metwally says the sale was never about the hard currency: “The purpose was not to bring in USDs but rather to have the state offload its stake in the company,” he said.

Remember: The Madbouly government is aiming to raise USD 2 bn via asset sales by the end of June. Together with the sale of Pachin to Dubai-based National Paints Holding, it has now reached some 7% (USD 147 mn) of that target.

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