The extraordinary general assembly of Egypt’s state-owned Chemical Industries Holding Company approved issuing 4 percent of its stake in Eastern Tobacco on the Egyptian Exchange (EGX).
Minister of Public Enterprises Khaled Badawi affirmed that this percentage comes as a part of the state’s initial public offering (IPO) program to expand the ownership base, provide financing for companies to expand their projects and the restructure process, revitalize the EGX, attract new investments, and achieve the highest degree of governance and transparency in the management of these companies.
Badawi added that the return from the offering of the Eastern Tobacco Company’s shares will be directed to restructure and develop the subsidiaries of the Holding Company.
On Wednesday, the minister said that Egypt’s IPO program is being turned into action quickly and is expected to start offering next month.
The minister considered the IPO program as a step for the growth of the economy, as it allows the private sector to manage the companies, even with a governmental stake in them.
He added that Engineering for Petroleum and Process Industries (Enppi) will be the first to be floated with 15-30 percent.
“We started a quick connection and negotiations with the IPO’s advisor, NI Capital, and the Ministry of Finance, as most of the general assemblies of the companies agreed upon the offering, and the final approval will be ready by the end of the month,” Badwi said.
In 2016, Egypt launched the government’s IPO program to offer shares over three to five years in several state-owned companies in fields such as petroleum, services, chemicals and real estate.
Chemical Industries Holding Company is the major share holder of 19 large and medium chemical industries companies.
The paid-up capital of the affiliated companies is about LE 2.06 billion ($115 million).
