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Egypt to offer army-owned Safi, Wataniya Petroleum in stake sales: Planning minister

The two companies will be offered to the private sector before being listed on Egypt’s stock exchange

Doaa A.Moneim , Wednesday 9 Dec 2020
SWF
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Egypt will soon offer the National Company for Producing and Bottling Water (Safi) and Wataniya Petroleum for private sector investment, said Minister of Planning and Economic Development Hala El-Said on Wednesday.

The two companies are owned by the National Service Products Organisation (NSPO), which follows the Egyptian Armed Forces.

In the first stage, the two companies will be offered to the private sector before being listed on Egypt’s stock exchange, where their stakes will be available to all Egyptians.

Established in 1979, the NSPO is an armed forces owned entity operating in various crucial developmental sectors to meet the needs of the military and the local market.

Its portfolio includes companies in the sectors of agriculture & food industry field, industrial field, engineering field, services field, and mining.

In recent months, Egypt has attempted to lure investors to its untapped assets, with the fund's CEO Ayman Soliman revealing that the fund plans to control some of the potentially valuable assets in industries such as power and real estate in order to attract private investors.

Last month, the SWF agreed to team up with UK private equity firm Actis to help attract and bring private investment into Egypt and to cooperate in energy and infrastructure projects.

The SWF has a paid-in capital of EGP 1 billion ($63.2 million), yet it could rise to several trillion pounds, according to statements made by President Abdel-Fattah El-Sisi in October 2019.

El-Said added that Egypt’s Sovereign Wealth Fund (SWF) signed two investment cooperation agreements in November with Egypt’s Ministry of Business Enterprise and the National Investment Bank to tap their assets and inject private investments into them.

El-Said explained that the fund was established to achieve the sustainable development goals that are part of Egypt’s 2030 Vision.

The minister's statements were made during a press roundtable held on Wednesday with media figures and SWF CEO Ayman Soliman.

El-Said said that it was important to establish a robust entity that can help in increasing investments and diversifying financing resources through establishing partnerships with domestic and global institutions, as well as making use of the state’s assets and resources for the sake of maximising their value, pushing the country’s development forward.

She added that Egypt’s SWF aims to tap the state’s unused assets as well as attain sustainable fiscal surpluses through designing unique investment products to invest in.

It also targets attaining sustainable financial proceeds over the long-term depending on a diversified and balanced portfolio that sets balance between revenues and risks, said the minister.

“Egypt’s SWF seeks to make positive social and economic impacts concerning investment. It will achieve its goals using a special portfolio that consists of Egypt’s assets that could be shifted to convenient products that can attract investors. These products can also encourage global, regional, and domestic investors to invest in Egypt’s high-priority sectors, therefore generating wealth and developing current and new projects,” according to El-Said.

Proactively, the fund allocates the state’s usable assets and cooperates with investors as well as operators for the sake of designing investment structures that meet their requirements and their venture measures, said El-Said.

The minister pointed out the fund’s investment plan’s priorities that include maximising the state’s assets’ revenues, localising manufacturing and technology, and attracting local and international investors.

She added that the fund has managed to attract investors from inside and outside the Egyptian market and it inked partnership agreements despite the ongoing economic challenges.

In addition, the fund inked a memorandum of understanding (MoU) with Hassan Allam Holding Company in order to pump joint direct and indirect investments to establish projects in electricity, water, infrastructure, and renewable energy sectors.

Moreover, it brokered a cooperation deal with the National Service Products Organisation in February, through which the fund became a partner to invest in the assets owned by the organisation, according to the minister.

El-Said highlighted the role the state is playing in supporting investment and the business environment especially in times of crises through creating entities that are capable of competing with the aim of increasing the country’s productive capabilities and providing the citizens’ needs.

She added that the fund will continue to cooperate with the organisation to open more of the companies it owns to private sector investing under rules and conditions that achieve high revenues for Egypt’s state and create real investment opportunities for the private sector.

Regionally, the minister said that Egypt has established an investment platform with Abu Dhabi Holding, worth $20 million, to establish joint investments in a varied collection of sectors including processing industries, traditional and renewable energy, real-estate, foodstuffs, tourism, healthcare, logistics, and financial services.

Globally, El-Said noted that the fund signed a MoU with Actis Long-life in January on the sidelines of the UK-Africa investment summit that targeted establishing joint investment in energy and infrastructure areas. 

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