Daily News Egypt

Egypt to offer shares in up to 10 government companies in next 18 months: finance minister - Daily News Egypt

Advertising Area




Advertising Area




Egypt to offer shares in up to 10 government companies in next 18 months: finance minister

Government paid $200m of arrears owed to IOCs in January, $550m to follow in February, March


The Egyptian government is planning to offer shares in between eight and 10 state-owned companies on the Egpytian Eexchange (EGX), over the upcoming 18 months, according to Finance Minister Amr El-Garhy’s statement to Reuters on Sunday.

El-Garhy explained that this comes as a part of the government’s plans to attract foreign investors. Consequently, the authorities aim to launch an initial public offerings (IPO) programme that will offer shares in plenty of state-owned companies over the next three to five years.

Moreover, El-Garhy previously told Daily News Egypt that the government’s IPO programme aims to offer three companies before June. He added that the Ministry of Finance is collaborating with the Ministries of Planning and Petroleum, the public business sector, and public banks on this programme.

According to El-Garhy, the government aims to increase the market capitalisation of the EGX to 50-60% of GDP over a period of three to five years. During that period, the economy’s size will have reached EGP 7tn. This means that the EGX’s value will be in the range of EGP 4tn, up from EGP 800bn now.

Furthermore, the programme is expected to start with the IPO of Enppi and Banque du Caire, and it will include different models for the offering process, including the presence of major companies that include banks, oil, and insurance companies.

On a different note, El-Garhy stated on Sunday that Egypt has successfully paid $200m of the arrears it owed to international oil companies (IOCs) in January, and another $550m will be paid in February and March.

According to a previous Ministry of Petroleum statement, the total amount of IOC arrears accounted for $2.4bn at the end of June 2017.

Earlier in 2015, the Ministry of Petroleum faced some challenges in triggering enough interest in the offered tenders; the reason behind this is believed to be the increasing debt levels to IOCs.

Cairo has pledged to eliminate arrears by the end of June 2019 and not to accumulate more, part of its drive to draw new foreign investment to an energy sector that is attracting interest following several major gas discoveries.

However, following the ongoing reform programme, the government has emphasised that they will eliminate arrears by 2019, and that it plans to transform Egypt into a major energy player.

The latest investment inflows within the sector highlight a boost in foreign players’ confidence in the Egyptian market. Investments of IOCs in exploration and development operations in the fiscal year (FY) 2016/2017 amount to around $8.1bn, according to Minister of Petroleum Tarek El Molla, who mentioned that the ministry is targeting $10bn worth of investments during the current FY 2017/2018.

Advertising Area



https://wwww.dailynewssegypt.com/2018/01/21/egypt-offer-shares-10-government-companies-next-18-months-finance-minister/
Breaking News

No current breaking news

Receive our daily newsletter
Subscribe