The companies are the armed forces-run National Company for Petroleum and the National Company for Natural Water in Siwa (SAFI). Both are affiliated to the National Service Projects Organisation (NSPO). 

The cabinet is yet to announce details on the offerings. 

In May, Egypt’s Prime Minister Mostafa Madbouly said the government plans to offer 12 companies under the government’s initial public offering (IPO) programme on the EGX by the end of 2022, including two army-run companies and others that are under the umbrella of the public business sector. 

In December 2020, Egypt’s Minister for Planning and Economic development Hala El-Said stated that the Sovereign Fund of Egypt (TSFE), which she heads, is working on qualifying the two companies to be offered to private sector investors in principle, then on the EGX. 

The NSPO and TSFE inked a cooperation agreement in March 2020 to promote NSPO-affiliated companies in line with President Abdel-Fattah El-Sisi's call to expand the ownership base of some assets owned by the organisation. 

This agreement allows the offering of some armed forces companies to the private sector, with up to 100 percent stake, according to the CEO of TSFE Ayman Soliman. 

Egypt’s IPO programme, which was kickstarted in 2019, was postponed due to the outbreak of the COVID-19 pandemic in March 2020. 

The government resumed the programme in 2021 with the listing of the state-owned digital services platform e-finance. 

In an interview with Ahram Online in June, Egypt’s Minister of the Public Business Sector Hisham Tawfik noted that the IPO programme was on hold due to structural and demand issues the local capital market is experiencing. 

“The EGX is currently not at its best. In general, the stake that will be offered for a local investor in the EGX ranges between five percent and 20 percent of the total offer, according to the latest IPO programme updates. Resuming the programme depends on market demand. This is the job of investment banks that set the stake that will be offered for the private sector and the shares that will be offered as public offering. We have noticed a weak local demand since the offering of the Eastern Company in 2019,” according to the minister. 

As Egypt seeks to grant the private sector a greater role to play in the country’s economic activities, the government launched in June the State Ownership Policy Document that charts a roadmap for expanding the private sector’s role in a number of economic activities in the Egyptian market. 

The policy sets number of paths to do so, including through offering state-owned companies on the EGX whether through a private offering or under the IPO programme. 

Egypt plans to raise the private sector’s share in the country’s economic activity to 65 percent over three years, up from the current 30 percent.