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State-owned Egyptian Arab Land Bank plans to sell off some assets to concentrate on high-yield sectors, according to the deputy chairman.
Egyptian Arab Land Bank (EALB) is in talks with a government-owned property firm to sell a 30% stake in National Real Estate and Investment Company (AKARAT), said a senior EALB official.
Adnan Al-Sharqawi, deputy chairman of the EALB board of directors, told TR Zawya that the stake sale was part of the bank's plan to dispose of some assets in order to focus on higher-revenue sectors.
"Egyptian Arab Land Bank has decided to transfer real estate assets worth USD 524 million to National Real Estate and Investment Company, ahead of negotiations to sell a stake in it (AKARAT)," he said, adding that the asset transfer and a final agreement on the stake sale could be completed in June.
Al-Sharqawi did not name the state-run property firm, but another source at EALB, who requested not to be named, said the company was Arab Contractors (Osman Hamed Osman and Co). If the deal goes through, AC would become one of the biggest real estate companies in Egypt.
"The bank (EALB) is disposing of some of its assets, so it can have liquidity to pursue other higher revenue-generating sectors," Al-Sharqawi said without elaborating.
EALB specializes in real estate investments and trade finance in Egypt. In Jordan and the Palestinian Territories, it has commercial branches providing corporate, retail and investment banking services.
AKARAT is 90% owned by EALB, while the rest of its shares are held by National Bank of Egypt. It has a paid-up capital of EGP 50 million (USD 6.6 million).
Al-Sharqawi said that EALB is in the process of restructuring AKARAT to allow it to operate independently from the bank and to compete in the Egyptian market and abroad. The company would be formed along three divisions; one focused on mega real estate projects, one focused on small real estate projects and another division that would manage parking areas and properties.
AKARAT develops and manages properties, communities and destinations. It also offers end-to-end property related services including sales and leasing, property management and facilities management.
© Zawya 2015
