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Beshay Steel sells minority stake to NSPO: Military-owned conglomerate the National Service Projects Organization (NSPO) has acquired minority stakes in three private-sector steel companies owned by Beshay Steel Group, according to a report from Asharq Business yesterday citing two sources it said are familiar with the matter.
The details: Beshay Steel sold up to 24% stakes in each of the three companies to the NSPO for around EGP 10 bn, according to Asharq. The transaction took place in the over-the-counter market on the EGX.
Beshay Steel is one of the region’s largest private-sector steel producers, churning out some some 4 mn tons of product a year, according to its website.
What the NSPO bought: The companies — Egyptian Sponge Iron and Steel Company, Egyptian American Steel Rolling Company, and International Steel Rolling Mills Company — account for the bulk of Beshay’s production. Egyptian Sponge is the company’s largest subsidiary, producing around 2 mn tons of steel per year. Meanwhile, Egyptian American has an annual capacity of 1.2 mn tons and International Steel produces 700k tons.
Who owns what : The companies were previously wholly owned by Beshay Steel, which is 100% owned by the Beshay family, according to the company’s LinkedIn page.Representatives of Beshay were not immediately available for comment.
Background: These are tough times for steelmakers. The ongoing economic crisis is causing losses to mount among steel producers, who are facing soaring production costs, slowing demand and raw material shortages.
The military has increased its presence in the steel industry in recent years, acquiring Suez Steel in 2016 and Egyptian Steel in 2018. The two companies’ combined capacity is around 3.7 mn tons a year.
Remember: The NSPO has been staking its claim in the energy sector. The company is expected to sell its Wataniya fuel retailing business as part of the government’s privatization program, but in July acquired a 20% stake in fuel retailer Taqa Arabia, which a few weeks later submitted a non-binding offer to acquire an unspecified stake in Wataniya.
