By Ahmed A Namatalla
Egypt has hired three investment banks to manage the sale of part of its stake in local oil company Enppi, marking a key step in the government’s plan to privatize state-owned businesses.
The government hired CI Capital, Jefferies International Ltd. and and Emirates NBD Capital Ltd. as lead managers and bookrunners to take public Engineering for the Petroleum & Process Industries, also known as Enppi, according to a statement issued by the Ministries of Petroleum and Investment & International Cooperation Wednesday. The sale of a 22-percent to 24-percent stake in the company is expected to raise up to $150 million, the government’s investment bank said last month.
“We are keen to see the success of this IPO program in broadening the ownership base in state-run companies through private sector participation,” Minister of Investment and International Cooperation Sahar Nasr was quoted as saying in the statement. The IPO will take place in the fourth quarter this year, she said.
The sale is part of Egypt’s plan to sell minority stakes in state-owned companies over the next year as officials seek to add depth to the country’s $40 billion equities market.
The planned offerings come as Egypt pushes ahead with reforms aimed at reviving an economy that had seen little in the way of growth since the 2011 uprising that ousted President Hosni Mubarak. The central bank last November floated the pound in a move that helped secure a $12 billion International Monetary Fund loan. The move, aimed at curbing a foreign currency crunch and attracting foreign investors, came in tandem with a fuel price hike and the introduction of a value-added tax that also led to surging consumer prices as inflation topped 30 percent — its highest level in decades.
Among other assets slated for sale is Banque Du Caire, the third-biggest state-owned lender,. The government plans to raise as much as 7.2 billion pounds ($400 million) by selling some of its shares.