The report showed that Egypt plans to offer stakes in the Siemens Beni Suef power plant, Gabal El-Zeit wind power plant, and Zafarana wind farm, in addition to Safi and Watanya, companies owned by the military.
The Egyptian government announced that it collected $5 billion from offering stakes in 13 companies between March 2022 and July 2023.
The government plans to offer stakes in 35 state-owned companies to strategic investors by the end of June 2024, under the State Ownership Policy Document. A list of 32 companies was released in February 2023 and three companies were added to it later this year; Eastern Company, Al Ezz Dekhila, and Telecom Egypt.
Siemens Beni Suef
The government aims to collect up to $1.8 billion for 70 percent of shares in the Siemens power plant in Beni Suef.
The deal is expected to be finalized in June 2024.
The plant is €735 million in debt to foreign entities and EGP3,514 billion to local entities.
Wataniya Petroleum, a company owned by the Egyptian Army's National Service Projects Organization (NSPO), has been split by the government, with a new entity taking 174 of Wataniya's 300 fuel plants.
The government is currently considering four non-binding purchase offers for the company, out of eight submitted.
Final contracts are to be signed in October or November 2023. The deal will be fully paid in US dollars.
Two investors are preparing to acquire a stake in the National Company for Producing and Bottling Water (Safi), another NSPO company.
A final deal is expected to be reached in December 2023.
The Egyptian government is offering to sell the Gabal El-Zeit wind power plant in exchange for a tariff of 2.4 US cents per kilowatt hour produced at the plant, 25 percent of which will be paid in Egyptian pounds. The buyer will still have to pay the value of usufruct rights for the land.
The deal is expected to be finalized in October 2023 after the completion of the due diligence.
Zafarana wind farm
The Zafarana wind farm, constructed in eight phases, has already been partially sold, with four going to the Danish shipping firm Maersk. The value of the deal will be determined after a financial valuation of the assets.
The remaining phases will be offered to investors on the condition that they be used in green hydrogen projects. Contracts are expected to be awarded in December 2023.
Water desalination plants
The Egyptian government plans to offer contracts in the first half of 2024 to build 21 water desalination plants in coastal areas, with a total production capacity of 3.3 million cubic meters per day (MCMPD). Two to four plants are planned for construction in Marsa Matrouh alone.
The plants are expected to receive $3.3 billion in investments from the private sector.
What has been accomplished so far?
Egypt's government announced that it has already collected $5 billion from offering stakes in 13 companies between March 2022 and July 2023.
These companies include the Commerical Bank International (CIB), Fawry, Abu Qir Fertilizers, MOPCO, and Alexandria Container & Cargo Handling, stakes in which were sold for $2 billion to the Abu Dhabi Holding Company (ADQ) in March 2022.
The government sold stakes in MOPCO, Abu Qir Fertilizers, E-Finance, and Alex Container for $1.3 billion to the Saudi Public Investment Fund (PIF) in August 2022.
In July 2023, stakes in seven historic hotels were sold to Talaat Mostafa Holding for $700 million.
Stakes in Ethedco, ELAB, and National Drilling were also offered for $800 million to the Abu Dhabi Fund for Development.
The privatization programme is part of Egypt's commitments under its $3 billion loan programme with the International Monetary Fund (IMF).
However, the IMF loan deal is currently facing challenges since the first review, originally scheduled to be completed on 15 March, has not yet been conducted.
Egypt seeks to accelerate the implementation of the IPO program to finalize the first and second reviews of the deal, which Morgan Stanley expects to be conducted in the coming months.
The country is coping with a local shortage of US dollars and a financing gap estimated at $17 billion through 2026.