{"id":605361,"date":"2023-08-30T00:00:00","date_gmt":"2023-08-30T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/2023\/08\/30\/privatization-info-dump-day\/"},"modified":"2023-08-30T00:00:00","modified_gmt":"2023-08-30T00:00:00","slug":"privatization-info-dump-day","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/egypt\/2023\/08\/30\/privatization-info-dump-day\/","title":{"rendered":"Privatization info-dump day"},"content":{"rendered":"

Good morning, ladies and gents<\/strong>, and a very happy almost-THURSDAY to you. We have an exceptionally heavy issue for you this morning, so strap in and let\u2019s get this show on the road:<\/span><\/p>\n

<\/a> Yesterday was privatization info-dump day: <\/strong> Between a leak that appears to be a version of the state ownership policy document, fresh rumors in the domestic and regional press, and statements from businesses and government officials, a deluge of privatization updates hit the news cycle yesterday. <\/p>\n

What we know: <\/strong> It was more fill-in-the-blanks details than blockbuster revelations, with new timeframes, updated targets, and a few new names attached to long-anticipated transactions that should hopefully be sewn up in the coming weeks and months.<\/p>\n

Cabinet ministers, assemble: <\/strong> Prime Minister Moustafa Madbouly yesterday gathered key<\/a> cabinet ministers and the governor of the central bank<\/a> for an update on what the International Finance Corporation (IFC) has been doing re. privatization. In June, the government appointed the financial institution<\/a> to develop its privatization strategy and advise it on implementation.<\/p>\n

The message? <\/strong> Privatization is still front and center of the government\u2019s agenda.<\/p>\n

WHERE THERE\u2019S NEWS, THERE ARE RUMORS- <\/strong><\/p>\n

#1- <\/strong> Eastern Com <\/strong> pany <\/strong> worth USD 4.5 bn <\/strong> +? Probably not. <\/strong>Reports circulating of the potential value of the government\u2019s sale of a stake in state-owned tobacco maker Eastern Company are \u201cfar from correct,\u201d a source at Eastern\u2019s state-owned parent firm Chemical Industries Holding Company (CIHC) told Enterprise. Al Borsa<\/a> reported yesterday several investors had offered to pay around USD 700 mn for c.15% of the company<\/a>, a figure which would value the firm at almost USD 4.6 bn. Eastern Company said in an EGX filing (pdf)<\/a> on Tuesday that it had not been informed of any updates on the potential sale.<\/p>\n

Remember: <\/strong> CIHC is looking to part with up to 15.3%<\/a> of Eastern Company \u2014 meaning Al Borsa\u2019s figure would value the shares on offer at at least a 246% premium to Eastern\u2019s closing share price on 21 August, before news of the transaction broke. <\/p>\n

When will the Eastern sale go through? <\/strong>As with any such transaction, timelines are mutable. CNBC Arabia said yesterday it would take place in 1Q 2024, Al Borsa says 1H 2024, our source said simply \u201cthis year.\u201d This much is clear: It\u2019s high on the state\u2019s list.<\/p>\n

#2- EBank says its not earmarked for privatization: <\/strong>The state-owned Export Development Bank (EBank) yesterday denied knowledge (pdf)<\/a> of any government intention to sell shares to private investors via the privatization program. An early study was underway to explore the idea <\/p>\n

of the bank bringing on board new investors via a capital increase, local media reported<\/a> back in April.<\/p>\n

Ownership breakdown: <\/strong> Ebank is 84% owned by state financial institutions, with the National Investment Bank holding the controlling 40.75% stake. Banque Misr owns 23.1% and the National Bank of Egypt has a 19.8% stake. <\/p>\n

#3- <\/strong> EIPICO denies rumors of exit by main shareholder: <\/strong> There are \u201cno offers or negotiations\u201d from EIPICO\u2019s main shareholder to sell down its stake in drugmaker EIPICO to a strategic investor, the company said in an EGX disclosure (pdf)<\/a>. The filing came in response to what the company called \u201crumors\u201d of an alleged stake sale. The company\u2019s largest shareholder is Acdima.<\/p>\n

HAPPENING TODAY- <\/strong><\/p>\n

<\/a> HSBC Egypt takes GAFI on the road: <\/strong>GAFI and our friends at HSBC Egypt are showcasing Egypt\u2019s Vision 2030 sustainable development strategy at the Africa<\/a> Singapore Business Forum<\/a>, which kicked off on Tuesday and runs through to Thursday in Singapore. The forum will bring together business and government leaders from over 30 countries to explore partnerships and growth opportunities between Africa and Asia with a particular focus this year on how companies can find business and investment opportunities in manufacturing, sustainability and the digital economy. More than 600 Asian investors and corporations are set to attend.<\/p>\n

That\u2019s not all from the double act: <\/strong>The two will also be speaking at the Singapore Business Federation before HSBC take GAFI to Beijing <\/strong> to participate in an HSBC China-hosted MENAT Summit taking place tomorrow<\/p>\n

HAPPENING THIS WEEK- <\/strong><\/p>\n

<\/a> FDI WATCH- <\/strong> Deadline day for the Smart Green Projects initiative: <\/strong> Submissions for the second phase of the Smart Green Projects initiative<\/a> will be due on Friday, 1 September<\/a>. The second iteration of the government-led initiative<\/a> is accepting applications for projects working on addressing issues like energy, emissions reduction, sustainable agriculture and green buildings. Shortlisted projects will get the chance to present their vision during COP28. The top three contenders in six categories are also awarded prizes between EGP 250k and EGP 750k.<\/p>\n

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TIME FLIES- <\/strong> As we near the final month of 3Q \u2014 here are the key news triggers on which to keep your eyes as we head into September:<\/p>\n