{"id":582029,"date":"2023-02-10T00:00:00","date_gmt":"2023-02-10T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/2023\/02\/10\/we-finally-know-which-companies-are-included-in-the-states-privatization-plans-el-sisis-off-to-dubai-next-week\/"},"modified":"2023-02-10T00:00:00","modified_gmt":"2023-02-10T00:00:00","slug":"we-finally-know-which-companies-are-included-in-the-states-privatization-plans-el-sisis-off-to-dubai-next-week","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/egypt\/2023\/02\/10\/we-finally-know-which-companies-are-included-in-the-states-privatization-plans-el-sisis-off-to-dubai-next-week\/","title":{"rendered":"We finally know which companies are included in the state\u2019s privatization plans + El Sisi\u2019s off to Dubai next week"},"content":{"rendered":"

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LAST WEEK IN 3 MINUTES<\/span>-<\/span><\/p>\n

<\/span> #1- IT WAS ALL ABOUT PRIVATIZATION<\/span>,<\/span> <\/span>with Prime Minister Moustafa <\/span>Madbouly unveiling plans t<\/span>o sell stakes in 32 state-owned companies over the next year. The <\/span>rebooted privatization program<\/a><\/span> will begin during the current quarter and continue through to the end of 1Q 2024, Madbouly said, adding that the government wants to pull the trigger on at least a quarter of the share sales within the first six months of the program. <\/span>The line-up<\/a><\/span> spans a wide variety of sectors including banking, oil and petrochemicals, real estate, ins. and ports.<\/span><\/p>\n

#2- OUR GULF FRIENDS WANT (BIG) PIECES <\/span>of a few of our state-owned players. The Qatar <\/span>Investment Authority still hasn\u2019t reached an agreement to buy Telecom Egypt\u2019s entire 45% stake in Vodafone Egypt. The hangup? TE is reluctant to part with more than 25%. A report this week suggests that\u2019s left room for Abu Dhabi\u2019s ADQ to mount a competitive bid. Gulf sovereign funds are also <\/span>reportedly interested<\/a><\/span> in acquiring an undisclosed stake in El Nasr for Fertilizers and Chemical Industries (Semadco). <\/span><\/p>\n

THE CATCH- We don\u2019t see strategic investors interested in small minority stakes<\/span>, and most <\/span>will want management control.<\/span><\/p>\n

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#3- <\/span>IT WAS A MIXED WEEK FOR ECONOMIC NEWS<\/span>.<\/span> <\/span><\/p>\n

The good: Non-oil exports<\/span> <\/span>rose<\/a><\/span>50%<\/a><\/span> in <\/span>2022<\/span> and our <\/span>current account deficit<\/span> <\/span>narrowed<\/a><\/span> <\/span>by 20% in 1Q2022-2023. Our <\/span>foreign reserves <\/span>inched up<\/a><\/span> <\/span>once again to USD 34.2 bn in January, while <\/span>policymakers are <\/span>considering a<\/a><\/span>temporary waiver<\/a><\/span> for the <\/span>capital gains tax<\/span> to mitigate the negative impact of the EGP\u2019s devaluation on local investors. <\/span><\/p>\n

The bad: inflation <\/span>reached a <\/span>fresh five-year high<\/span> (more on that in Sunday\u2019s EnterpriseAM <\/span>edition) and pushed our <\/span>non-oil private sector<\/span> deeper into <\/span>contraction <\/span>territory for the 26th consecutive month in January. <\/span><\/p>\n

The ugly:<\/span> <\/span>Moody\u2019s <\/span>downgraded<\/a><\/span> <\/span>our <\/span>credit rating<\/span> for the first time in a decade on the back of <\/span>our<\/span> \u201creduced external buffers and shock absorption capacity.\u201d <\/span><\/p>\n

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#4- IT WAS ALSO AN INTERESTING WEEK ON THE M&A FRONT:<\/span> BPE Partners\u2019 <\/span>B <\/span>Investments<\/span> finalized the <\/span>sale<\/a><\/span> of its entire 6.38% stake in <\/span>TotalEnergies Egypt<\/span> to TotalEnergies Marketing Afrique (TEMA), as a separate BPE Partners-backed vehicle\u2019s also exited its 9% stake to TEMA. Meanwhile, <\/span>Palm Hills<\/span>\u2019 second-largest shareholder, <\/span>AAIB<\/span>, <\/span>is looking to sell<\/a><\/span> its entire 12.7% stake in EGX-listed Palm Hills Developments to Emirati investment company <\/span>Al Ain Holding<\/a><\/span>, while <\/span>International Company for Medical Industries<\/span> <\/span>will go ahead<\/a><\/span> with an acquisition of a 72% stake in Mansoura-based medical textiles company <\/span>Banff Non Wovens<\/a><\/span> for EGP 23.4 mn. Finally, Sri Lankan conglomerate <\/span>LOLC Group<\/a><\/span> reportedly said it wants to acquire several unnamed local firms under a yet-to-be-established holding company in the near future.<\/span><\/p>\n

#5- THE MADBOULY GOV\u2019T LOBBIED FOR INVESTMENTS: <\/span>Prime Minister Moustafa <\/span>Madbouly <\/span>discussed<\/a><\/span> <\/span>potential Croatian investments in the Suez Canal area with the country\u2019s president, Zoran Milanovi\u0107, while Planning Minister Hala El Said <\/span>pushed<\/a><\/span> <\/span>Qatari business leaders to step up their investments in Egypt during talks in Doha.<\/span><\/p>\n

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WHAT\u2019S HAPPENING NEXT WEEK-<\/span><\/p>\n

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We expect there to be continued speculation on the rebooted privatization program <\/span>in the local press as the Madbouly government gets ready to sell down stakes in eight companies over the next seven weeks. <\/span>Remember:<\/span> We think s<\/span>elldowns of state positions in already-listed companies and direct stake sales to strategics can happen anytime. But we don\u2019t expect IPOs before May \/ June at the absolute earliest \u2014 September is a more likely timeframe.<\/span><\/p>\n

President Abdel Fattah El Sisi will be in Dubai to attend the <\/span>World Government Summit<\/a><\/span>, <\/span>which runs 13-15 February. Twenty heads of state will be in town for the Davos-like gathering, which will see policymakers from around the world discuss global trends in policymaking, according to Emirati state news agency <\/span>WAM<\/a><\/span>.<\/span><\/p>\n

Petro-show next week:<\/span> Oil and gas industry figures from Egypt and the region will congregate at the Egypt International Exhibition Center for the <\/span>Egypt Petroleum Show (Egyps)<\/a><\/span> starting next Monday. The three-day conference runs 13-15 February.<\/span><\/p>\n

MPs are back next week:<\/span> The House will reconvene on Sunday, 12 February. <\/span><\/p>\n

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? WE HAVE TWO CALENDARS NOW-<\/span> Our Weekend Edition and EnterprisePM calendar (at the bottom of this email) include a full rundown interesting events coming up in Cairo, from art exhibitions to concerts and marathons.<\/span><\/p>\n

Find our regular business calendar<\/span>, which includes a comprehensive listing of upcoming news events and news triggers, in EnterpriseAM and <\/span>on the web<\/a><\/span>. <\/span> <\/span><\/p>\n

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