{"id":610639,"date":"2023-11-24T00:00:00","date_gmt":"2023-11-24T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/2023\/11\/24\/gaza-truce-starts-global-investment-company-nabs-30-of-eastern-company\/"},"modified":"2023-11-24T00:00:00","modified_gmt":"2023-11-24T00:00:00","slug":"gaza-truce-starts-global-investment-company-nabs-30-of-eastern-company","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/egypt\/2023\/11\/24\/gaza-truce-starts-global-investment-company-nabs-30-of-eastern-company\/","title":{"rendered":"Gaza truce starts + Global Investment Company nabs 30% of Eastern Company"},"content":{"rendered":"

Good morning friends and HAPPY FRIDAY. <\/strong>We hope that you\u2019re enjoying the milder weather and getting some respite from the past week. <\/p>\n

In the Enterprise guide this week, <\/strong>we intend to bring you closer to your community that is working hard during this time of adversity to support local brands.<\/p>\n

With this said, we have prepared a guide to some local fast food joints in our community<\/strong> that are either supporting more local brands and\/or using some of their proceeds to support our brothers and sisters in Gaza.<\/p>\n

Enterprise Weekend comes out each Friday at 9:00am CLT.<\/strong> We\u2019ll be back on Sunday at 6am with EnterpriseAM. Until then: Enjoy the weekend.<\/p>\n

WITH THE PAUSE IN FIGHTING, GAZA IS NOW IN NEED OF MORE AID-<\/strong><\/p>\n

Want to support relief efforts in Gaza, but don\u2019t know how?<\/strong> We\u2019ve got you. More than 1 mn people in Gaza have been thrown from their homes and every human being there lacks access to food, water, and fuel amid the most intense bombardment any population has endured this century. The pause in fighting means that there\u2019s a chance to support Gaza with more aid that will make a difference.<\/p>\n

The folks at Talabat are processing donations for a range of Gaza relief appeals <\/strong>by charities including the Egyptian Food Bank and Misr El Kheir. Pay in EGP using your credit card.<\/p>\n

Or check out <\/strong>our list of charities<\/a><\/strong> to which you can make direct donations<\/strong> via bank deposit and \/ or Fawry.<\/p>\n

LAST WEEK IN 3 MINS- Israel\u2019s war on Gaza continued to lead the news cycle at home<\/strong> and globally <\/strong>and ended the weekas we anticipate the four-day truce that should have begun yesterday but has been moved forward to today.<\/p>\n

AT HOME- We saw a crucial development in the state\u2019s privatization drive<\/strong> as well as some fresh loan agreements and bills moving along in the House of Representatives.<\/p>\n

UPDATES ON THE TEMPORARY REPRIEVE AT THE END OF ANOTHER BRUTAL WEEK<\/strong> IN GAZA-<\/strong><\/p>\n

#1- The truce in Gaza started two hours ago, after it<\/strong>has been postponed for a day.<\/a><\/strong>Israel continued its assault of the strip yesterday with 300 air strikes, which included Khan Younis, a southern city that Israel had claimed would not be attacked, reports Reuters<\/a>.<\/p>\n

The<\/strong> hostage-for-ceasefire agreement should see a four-day<\/strong> pause in fighting<\/strong>in return for the release<\/a> of some hostages. Following weeks of negotiations mediated by Egypt and Qatar, Hamas agreed to release 50 women and children during the four-day truce in exchange for the release of 150 Palestinian prisoners held by Israel and that 200 additional aid trucks be granted permission to cross through the Rafah border every day. <\/p>\n

#2- Egypt drafted a UN Security Council resolution that aims to overcome \u201cexisting<\/strong> obstacles and imbalances\u201d to the entry of aid into Gaza<\/strong>, the Foreign Ministry said earlier this week. <\/p>\n

#3- Madbouly reiterated the government\u2019s refusal to accept the displacement of<\/strong> Palestinians into Sinai:<\/strong> \u201cEgypt will take a firm reaction against any attempts to resettle Palestinians in Sinai,\u201d Madbouly told MPs on Tuesday. <\/p>\n

#4- Earlier in the week, Israeli forces ordered doctors, patients and refugees to evacuate<\/strong> Gaza City\u2019s Al Shifa Hospital. <\/strong>Doctors and witnesses reported<\/a> that the IDF had given the thousands of people at the hospital an hour to vacate the area and escorted some of them out at gunpoint.<\/p>\n

\u2026and <\/strong>continued its air assault<\/a><\/strong> on the Jabalia refugee camp <\/strong>and one UN school, which Egypt decried as a war crime and a \u201cdeliberate insult to the UN.\u201d<\/p>\n

#5- Still, Israel is, so far, yet to provide evidence of the claimed Hamas command center<\/strong> underneath Al Shifa:<\/strong> The military\u2019s siege has all but destroyed Al Shifa<\/a> as a functioning hospital, with a visiting UN team calling it a \u201c death zone \u201d after surveying the site on Saturday.<\/p>\n

#6- Another Israeli minister called for ethnic cleansing: <\/strong>Intelligence Minister Gila Gamliel became the latest senior government official to call for<\/a> the \u201cvoluntary resettlement\u201d of Palestinians outside of Gaza. <\/p>\n

\u2026but the EU isn\u2019t on board: <\/strong>EU Commission President Ursula von der Leyen backed Egypt\u2019s rejection of Israeli ambitions to forcibly displace Gazans into Sinai during talks with President Abdel Fattah El Sisi in Cairo on Saturday<\/a>.<\/p>\n

#7- The death toll in Gaza rose <\/strong>to 14.5k + <\/strong>and at least 53 journalists have been killed since Israel started its bombardement of the territory, marking the deadliest month for journalists since CPJ began gathering data in 1992.<\/p>\n

WE SAW A MAJOR DEVELOPMENTS IN THE STATE\u2019S PRIVATIZATION DRIVE-<\/strong><\/p>\n

The government offloaded 30% of Eastern Company in <\/strong>a stake sale worth USD 625 mn<\/a><\/strong>, making it the single-largest transaction since it rebooted its privatization drive earlier this year. <\/p>\n

UAE-based Global Investment Holding (GIH) purchased the stake from the<\/strong> company\u2019s state-owned majority shareholder,<\/strong> the Holding Company for Chemical Industries (CIHC) for EGP 24.52 apiece, totaling EGP 16.4 bn (USD 532 mn). GIH agreed to pay an additional EGP 4.38 per share, taking the total value of the transaction to EGP 19.3 bn (USD 625 mn) and making it the company\u2019s single-largest shareholder.<\/p>\n

Advisors:<\/strong> Our friends at EFG Hermes<\/strong> advised GIH on the transaction and were also sole broker for its execution, they said in a statement (pdf)<\/a>.<\/p>\n

GIH will provide Eastern Company with <\/strong>some USD 150 mn<\/a><\/strong> in hard currency next year<\/strong> to bolster the cigarette maker\u2019s ability to source manufacturing inputs. GIH reportedly sees the facility as a key measure to ensure the profitability of its new investment. <\/p>\n

The government will use the bulk of the proceeds from the sale<\/strong> to invest in fresh capacity at existing state-owned fertilizer plants with an eye to ramping up exports. It will use the rest of the cash to help narrow the budget deficit.<\/p>\n

IT WAS A RELATIVELY BRISK WEEK ON THE ECONOMY FRONT-<\/strong><\/p>\n

#1- The IMF is \u201cseriously considering\u201d increasing Egypt\u2019s USD 3 bn loan program due to<\/strong> the war in Gaza,<\/strong> IMF Director Kristalina Georgieva said this week<\/a>. \u201cInvestors are going to be shy to go to [these countries]. The cost of ins., if you want to move goods, they go up. Risks of even more refugees in countries that are already accepting more,\u201d Georgieva previously said. <\/p>\n

#2- BMI expects state asset sales to underpin stronger economic growth this year:<\/strong>Economic growth will accelerate to 4.2% this year from 3.8% in FY 2022-2023 as progress on asset sales draws new FDI that will \u201cmore than offset\u201d the impact of falling demand and limited ability to cut imports according to BMI<\/a>, a research unit of Fitch Solutions. <\/p>\n

Still, BMI\u2019s latest outlook is a minor downgrade from its previous 4.4% forecast<\/strong> following the outbreak of war in Gaza, which it says will drag on investment, consumption, and exports.<\/p>\n

A HANDFUL OF INVESTMENT UPDATES WORTH NOTING-<\/strong><\/p>\n

#1- Units of Saudi Arabia\u2019s Fawaz Abdulaziz Alhokair Company (Alhokair) could invest as<\/strong> much as <\/strong>USD 1.5 bn in Egypt in 2024<\/a><\/strong>. Energy, real estate, and infrastructure are on the priority list. <\/p>\n

#2-<\/strong>Saudi Arabia\u2019s Public Investment Fund (PIF) raised its stake in EGX-listed fintech<\/strong> player e-Finance <\/strong>by two percentage points<\/a> to 27% by purchasing freefloat shares. The Saudi wealth fund acquired 25% of the company last year for EGP 7.5 bn, becoming its single-largest shareholder and getting two seats on the board<\/p>\n

#3- Mitsui & Co. agreed to <\/strong>purchase a stake<\/a><\/strong> in Egyptian broiler chicken producer Wadi Poultry.<\/strong> The size of the stake and the investment were not disclosed. <\/p>\n

AND OUR TOURISM AMBITIONS MIGHT STILL BE ON TRACK -<\/strong><\/p>\n

Egypt saw some <\/strong>13 mn tourist arrivals<\/a><\/strong> in the first nine months of the year. <\/strong>This puts us on track to hit our target of 15 mn visitors in 2023, up 32% from the year before, despite worsening tourist appetite in the region since the onset of the war in Gaza.<\/p>\n

WE ALSO SAW A FEW LOAN AGREEMENTS INKED-<\/strong><\/p>\n

#1- CIB is getting a USD 150 mn <\/strong>subordinated loan<\/a><\/strong> from the European Bank for<\/strong> Reconstruction and Development (EBRD<\/strong>) to strengthen its tier II capital, support growth, and protect it from external economic shocks. <\/p>\n

#2- Turkey\u2019s Hayat is borrowing EUR 30 mn to expand in Egypt:<\/strong> Emirates NBD Egypt signed a EUR 30 mn<\/a> medium-term loan agreement with Turkish sanitary product company Hayat\u2019s local subsidiary Hayat Egypt to help it finance a new USD 70 mn tissue factory in Ain Sokhna.<\/p>\n

AND SOME MOVEMENT IN OUR MANUFACTURING SECTOR-<\/strong><\/p>\n

#1- The IDA extended its break for industrial investors:<\/strong> The Industrial Development Authority (IDA) pushed back the deadline<\/a> for investors who have not been able to finish construction and obtain licenses for the factories they\u2019ve been allotted land for within the required three-year period until 24 January. The extension was first introduced in January with a 24 July deadline.<\/p>\n

#2- Local plastics manufacturer Al Ahram Plastic Company is looking to set up an <\/strong>EGP 1<\/a><\/strong>bn packaging material factory<\/a><\/strong> in Badr City. The new factory, part of its expansion plan to double production, will have a production capacity of 60k tons a year, 80% of which will be exported. The manufacturer is expected to kick off operations within the coming three months.<\/p>\n

PARLIAMENT SIGNED OFF ON A HANDFUL OF BILLS-<\/strong><\/p>\n

#1- The House of Representatives approved <\/strong>a raft of new bills<\/a><\/strong> last week:<\/strong><\/p>\n