Cairo (APD) - State-owned Arab Contractors decided to launch an Initial Public Offering (IPO) for 25% in its subsidiary Arab Contractors Investment in January.
The offering is the first step in the privatization of Arab Contractors, Ibrahim Mahlab, chairman and CEO of Arab Contractors, told Egypt's business daily, al-Alam al-Youm.
State-owned Banque Misr will be the lead manager for the IPO in Arab Contractors Investment.
Mahlab predicted huge demand for the IPO due to the current boom in the real estate and construction markets.
Privatization of Arab Contractors Investment had already been discussed early in 2005. The investment company is owned by Arab Contractors (88.37%) and the Arab Contractors Employee Pension Fund.
On September 15, Arab Contractors Investment announced cash dividends of LBP 2.2 per share, which have a par value of LBP 10.
A state-owned firm with a workforce of over 55,000, Arab Contractors derives the bulk of its revenue from domestic contracts but figures provided on the company's website showed an increasing share of turnover from international contracts in the last two years. Its net fixed assets stood at LE 2.136 billion at end of FY 2003/2004, the company said.
After Egypt's privatization program came to a complete halt in the late 1990s, Egypt announced in September 2004 the resumption of the program as several state corporations will be completely sold off, while others would see the sale of government stakes between 15% and 88%.
The government has a huge portfolio of state-owned companies that includes 180 large corporations in addition to shares in about 700 private companies. [TS]
By Eman Wahby, APD Staff Writer in Cairo
© APD (Arab Press Digest) 2005
