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Egypt Aims to Raise 6b Pounds from Sale of Stakes in State Firms

Source: Reuters 3/21/2017, Location: Egypt

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Egypt aims to raise 6 billion pounds ($329 million) from the sale of stakes in state companies in the 2017/18 financial year, Finance Minister Amr El Garhy told Reuters, part of government efforts to generate revenue and attract investors.

He did not specify which companies would be involved, or the size of the stakes which would be offered to investors.

Egypt plans to offer shares in several public companies, mainly in the petroleum and financial sectors, on the stock exchange this year.

The offerings will be its first since 2005, when the state sold shares in Telecom Egypt, AMOC and Sidi Kerir.

The Egyptian government owns a large number of companies in various industries as well as several banks, but its efforts to privatise state holdings have proven politically sensitive.

The 2011 uprising that ended Hosni Mubarak's 30-year rule followed years of complaints over the spread of what many considered crony capitalism, with stakes in state firms being sold off to big investors with political connections.

The government plans to sell minority stakes of 20-30 percent mainly through stock exchange offerings, which are widely seen as more transparent and could also help strengthen the bourse and attract investors.

Oil Minister Tarek al-Molla said last year that eight petroleum companies were among those being considered for privatisation.

Central Bank Governor Tarek Amer has said the government also plans to offer 20 percent of Banque du Caire as well as a 40 percent stake in the Arab African International Bank (AAIB), in which the central bank owns a stake.

Banque du Caire is expected to list its shares in the first half of the year.

The moves are part of Egypt's efforts to revive its economy after the 2011 uprising drove away tourists and foreign investors. On Nov. 3, the central bank abandoned its peg of 8.8 pounds per dollar, allowing the pound to halve in value. The stock market has rallied in response to the float with foreign investors also buying up government debt instruments

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