Cairo (APD) - A group of investors from Kuwait, Saudi Arabia and UAE have expressed interest to participate in the third production line of Egyptian Fertilizers Company (EFC), the pan-Arab daily, Asharq al-Awsat, reported Monday.
Adel al-Mozy, president of Holding Company for Chemical Industries, said that the third production line will include setting up a factory in Gulf of Suez City of al-Ain al-Sokhna for the production of 750,000 tons of fertilizers.
He added that the third production line would either produce ammonia or urea fertilizers that currently witness high demand in the local market, in addition to export opportunities to the neighboring African and Arab markets.
Al-Mozy estimated the cost of the project to reach $460 million in case it was specialized in the production of ammonia fertilizers and $380 million in case the factory specialized in the urea fertilizers.
He added that the local market suffers from gap between the demand and supply of ammonia and urea fertilizers, whose production does not exceed 1.5 million tons a year, while the local demand is 1.9 million tons. Al-Mozy expected the construction of the third production line to start early 2006 and will take up to three years to start actual production.
On the other hand, al-Mozy said that the Egyptian Fertilizers Company is currently setting up its $350 million the second production line for the production of 650,000 tons of urea fertilizers, expecting the project to start actual production in April 2006 also.
A fierce competition started last May to acquire the Egyptian government's 46% stake in EFC. Finally, the consortium led by the Egypt's National Fertilizers Company won last July the acquisition with a bid of $501 per share in a $341.7 million deal.
The consortium, which includes also Citadel Capital Company and the Saudi-based Savola Group, beat an offer by the Egypt Kuwait Holding Company, which holds 11.75% of EFC. The Saudi Basic Industries Corporation (SABIC) and India's Homefield International PVT dropped out of the bidding.
EFC boasts a stable financial position and maintains a steady growth in profits. EFC started producing in 2000 and has produced 1.9mn tons of ammonia and urea during the last three years.
The company's net profits increased 2.7% to reach $65.3 million in 2004, compared to $63.6 million in 2003. [FC]
By Eman Wahby, APD Staff Writer in Cairo
© APD (Arab Press Digest) 2005
