The Suez Steel Company is in the process of a final agreement on a capital increase to the limits of its authorized capital of LE 600 million. The company’s chairman Gamal Al-Garhy pointed to ongoing talks with an Arab investor with large experience in operating steel companies.
He said Wednesday that Suez Steel would sell off between 30 percent and 35 percent of its shares to an Arab investor to raise the necessary capital increase funds. Currently, the company’s paid-in capital amounts to LE 136.4 million.
Al-Garhy pointed out that the Arab investor, who requested anonymity, was extensively experienced in operating production lines of steel companies, which should feed positively into the company’s performance.
He expected sale procedures to be concluded by the end of next year.
The company’s general meeting on Tuesday approved the board’s proposal to increase capital to LE 600 million – the high end of its authorized capital. Shareholders also agreed to postpone the merger of Suez Steel with Misr National Steel Company (Ataqa) which is a family business owned by Al-Garhy’s – until the capital increase has been concluded.
Ataqa had last September taken over the government stake in Suez Steel estimated at 82.3 percent for LE 1.1 billion, beating two Saudi competitors for the deal.
Suez Steel was first launched in 1997 with an authorized capital of LE 600 million and a paid-in capital of LE 136.4 million. The company’s annual capacity amounts to 600,000 tons of iron and its sales hit LE 991 million in 2005.
