The government is out of Al Ezz Dekheila: The government has sold its entire 31%stake in Ezz Steel subsidiary Al Ezz Dekheila for USD 241 mn, Planning Minister Hala El Said said yesterday (watch, runtime: 10:17). El Said made the announcement at a press conference to announce a string of asset sales under its IMF-backed privatization program (read the full rundown above.)

Al Ezz Dekheila to delist: Al Ezz Dekheila announced (pdf) earlier in the day that it would be voluntarily delisting from the EGX within three months and offered to buy back the shares from objecting shareholders for EGP 1,250 per share, 52.4% above the stock’s closing price on 9 July and 38.6% above the three-month average up to 10 July. The company said it will finance the buyout through foreign-currency loans, primarily from foreign banks. Representatives of Al Ezz Dekheila didn’t respond to our phone calls when we reached out for comment yesterday.

We had an idea this was coming: In a letter to the Sovereign Fund of Egypt leaked by Cairo24last month, Al Ezz Dekheila said that a number of state-owned shareholders — which include the National Investment Bank and the National Bank of Egypt — had signaled they would divest their stakes and sell them back to the company. This came in the wake of a report from Asharq Business, which claimed that two state institutions were in talks with Ezz Steel to sell down a combined 14% stake in Al Ezz Dekheila.

Remember: Government ownership of the company is spread among a number of institutions. NIB and NBE are the largest single shareholders, owning 8.15% and 5.78% respectively, according to a company document (pdf). Stakes are also held by Misr Ins., Misr Life Ins. and Banque Misr, as well as a number of state funds.

Why the voluntary delisting? Buying back 30% of its shares from the state-owned entities would have put the company in breach of listing rules, which require companies to have at least 10% of their share capital in freefloat. “When the company buys out these stakes, its status as a listed company will violate the EGX rules, which will obligate them to delist from the EGX,” Omar Taha, an equity analyst at Prime Research, told us. “A voluntary delisting would be the best method to preserve the share’s value.”

Why the exit? “These state-owned companies want to divest their shares because they need liquidity given the country’s FX crunch, and in light of the government’s efforts to bring more foreign-currency into the public purse,” Taha told us.

Market reax: Al Ezz Dekheila’s share price surged 20% during trading yesterday to close at EGP 978.87.

What’s next: Shareholders will convene on 5 August to vote on the decisions to delist and buy-out the remaining shareholders.

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