From the trading floor

Ahram Online , Friday 21 Jun 2019

BANQUE DU CAIRE: The state-owned bank that is soon to see an initial public offering (IPO) of shares will offer a stake larger than previously announced. Tarek Amer, the Central Bank of Egypt (CBE) governor, told a conference on Monday that 30 to 40 per cent of the bank would be put on the bloc.

Amer himself had previously put the stake at 20 to 30 per cent with a targeted revenue of $300-400 million. A deal to sell the bank was cancelled in 2008, and a planned IPO has been repeatedly postponed over the past three years.

The bank is currently totally owned by Banque Misr, Egypt’s second-largest public bank.

It embarked on an overhaul last year, which resulted in net profits tripling in the first quarter of 2019 to reach LE1.22 billion. It also reported a 207 per cent jump in net profits after tax to LE2.5 billion in 2018 and succeeded in expanding its loan base by 50 per cent last year by targeting corporations in industries including real estate, oil and gas, construction, and export-driven activities.

EL-SEWEDY ELECTRIC: In a move that should make it one of the largest renewable energy producers in Greece, El-Sewedy Electric is negotiating a 55 million euro agreement to acquire 100 per cent stakes in three wind and one hydroelectric company from Greece’s RF Energy. The four together generate enough energy to power 34,000 homes.

The bulk of the deal, or 75 per cent, will be paid in cash through a facility provided by the National Bank of Greece (NBG) and the rest will be paid in equity. El-Sewedy Electric said last month that it had received a 42 million euro loan from the NBG and did not say what the funding would be used for.

The transaction marks El-Sewedy’s second independent power-producer project in the region after its $75 million investment in a solar power facility in Benban in Egypt.

CLEOPATRA HOSPITAL GROUP (CHG): The group, which owns a number of Cairo’s largest hospitals, is to acquire a large in-vitro fertilisation (IVF) centre, it was announced this week.

“The acquisition not only sees CHG further strengthen its service-offering in line with our expansion strategy, but also sees us

venture into a new, fast-growing and high-margin segment reinforcing our position as leaders in the Egyptian healthcare sector,” said the Cleopatra Hospitals Group CEO in a company statement.

The group expects the deal to be concluded by late 2019. According to the statement, the target acquisition currently offers an extensive list of services including obstetrics, gynaecology, infertility, andrology, erectile dysfunction, dermatology, reproductive health and laser treatments, nutrition and health coaching, fetal medicine, psychology, and family health services.

CHG is the largest private hospital group in Egypt by number of hospital beds and operating hospitals. The company holds majority stakes in five leading hospitals in the Greater Cairo area, including the Cleopatra Hospital, the Cairo Specialised Hospital, the Nile Badrawi Hospital, the Al-Shorouk Hospital, and the Queens Hospital, offering a full array of general and emergency healthcare services.

ORASCOM CONSTRUCTION INDUSTRIES (OCI): The company has lines of business extending from constriction and fertilisers, and this week it was announced that it would merge its ammonia and urea assets in North Africa with Adnoc’s fertiliser complex in the United Arab Emirates.

The agreement would create the region’s largest fertiliser producer with $1.74 billion in annual sales to challenge US and Russian exporters. The move comes amid oversupply in the international fertiliser market, a fact that has pushed the major players to explore consolidation to improve economies of scale and global reach, according to Bloomberg.

The new joint venture, which will be 58 per cent owned by OCI and headed by its founder billionaire Nassef Sawiris, is expected to generate as much as $75 million in annual savings.

ORASCOM DEVELOPMENT EGYPT (ODE): This largest subsidiary of Orascom Development Holding (ODH) has concluded the sale of its 87 per cent equity stake in Tamweel Group to Ebtikar for Financial Investment for LE360 million.

The share transfer was executed after obtaining the necessary approvals, and ODE will now start receiving the proceeds. “The cash proceeds of the sale are geared towards ODE’s debt-reduction plan, which entails further reducing its outstanding debt balance

in 2019 and thus enhancing our balance sheet,” according to a press release.

The news came a few hours after ODE had signed a 228.1 million Swiss franc debt-rescheduling package, strengthening its balance sheet and creating more flexibility in advancing its projects. According to the package, ODE will make an immediate cash payment of 19.5 million Swiss francs. Creditors agreed to reduce the interest rate margin on the foreign currency debt by one per cent, resulting in savings of four million Swiss francs in interest payments for 2019 and a total of 19 million francs over six years.

ODH is a leading developer of fully-integrated destinations that include hotels, private villas and apartments, leisure facilities such as golf courses, marinas and supporting infrastructure. Its outreach includes seven jurisdictions (Egypt, the UAE, Oman, Switzerland, Morocco, Montenegro and the United Kingdom), with a primary focus on touristic destinations.

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