Real estate, OT help boost Egypt index
Orascom Telecom (OT) and a bullish real estate outlook boosted Egypt’s main index to fresh highs, in a rally traders said they expect to continue on Thursday and next week.
“I see us going up to 7,700 (points) by tomorrow or Sunday, said Teymour El-Derini of Naeem, adding he expects OT to continue leading the index.
Orascom Telecom climbed 4 percent on ongoing speculation it will sell its Algerian unit Djezzy. It has surged more than 28 percent this month.
Talaat Moustafa Group, Egypt’s largest listed developer, added 1.6 percent after saying it sold LE 1.2 billion ($218 million) worth of real estate units in the first quarter of 2010.
Egyptian Resorts, which makes most of its money selling land on Egypt’s Red Sea coast to developers, was among the index’s top winners, climbing 5.9 percent on continued talk a prominent businessman has bought into the firm, traders said.
On Sunday brokers who asked not to be identified said Samih Sawiris, chairman and CEO of Orascom Development Holding had bought a stake in the firm after Rowad Tourism sold a roughly 5 percent of the company.
The index climbed 2.2 percent to 7,591 points, levels not seen since September 2008. -Reuters
Egypt plans sukuk regulations in H2
Egypt plans to issue its first regulations governing sukuk, or Islamic bonds, in the second half of this year, the financial regulator told Reuters on Wednesday.
“There are currently no rules for sukuk, and this is part of a comprehensive program to expand and deepen the fixed income market, Ziad Bahaa Eldin, head of the Egyptian Financial Supervisory Authority (EFSA), said in an emailed statement.
EFSA will issue the regulations and apply them, he said, adding that it was premature to say how much financing potential an Egyptian sukuk market would have.
“The potential is undoubtedly there, but difficult to accurately estimate at this stage, he said.
Total global sukuk issuance was $19.1 billion last year, with Malaysia and Indonesia accounting for almost half, Thomson Reuters data shows.
Egypt has streamlined rules for both corporate and government instruments and hopes to set up a secondary bond market this year. -Reuters
Egypt to reissue cement licenses to two firms
Egypt is set to reissue production licenses to two cement firms that had their permits scrapped, in a move that could help meet demand in a buoyant construction sector which has defied a regional downturn.
El Wadi Cement and North Sinai Cement had their licenses cancelled late last year over start-up delays and financing shortfalls, but were granted 60 days to challenge the decision.
While the firms did not meet the conditions during the appeal period, they have since made efforts to secure financing to help get their projects off the ground.
“The licenses will be reissued in the same areas to ensure sustained development and the flow of investment to those two areas, Amr Assal, head of the Industrial Development Authority, said on Wednesday.
The new licenses will be issued in May, he added.
In February, El Wadi said it had secured a $328 million loan from Liechtenstein bank LLB to build a 1.5 million ton per year cement factory.
Assal said North Sinai Cement, to build its plant in central Sinai with investments worth LE1.7 billion, had also secured financing. He did not give details.
Egypt’s construction industry has grown despite the global economic downturn, even as it has stalled elsewhere in the region. Cement demand rose 25 percent last year, driven largely by a growing population and cash-fuelled economy.
Egypt aims to boost its cement production capacity to 80 million tons a year from 50 million now, and has said it will start the bidding process for eight additional production licenses by the middle of this year.
North Sinai Cement and El Wadi Cement were granted two of six cement factory licenses offered in late 2007 in a bid to boost production and drive down soaring local prices. -Reuters
Mobinil sees ownership deal soon
Egyptian mobile telecoms operator Mobinil expects its two major shareholders to announce a resolution to their long-running dispute within a month, its chairman said on Tuesday.
Orascom Telecom’s executive chairman Naguib Sawiris had met France Telecom’s new chief executive, Stephane Richard, in Paris late in March and talks were continuing between senior executives, Alex Shalaby told Reuters in an interview.
Asked when he thought a deal could be reached, Shalaby said: “I’m talking no more than a couple of weeks, a month maximum. I know there are intensive discussions.
An Egyptian court on Saturday upheld a ruling blocking France Telecom from gaining full control of the company, a development Shalaby said helped push the sides back to negotiation.
“If it (the ruling) did anything, it certainly is going to accelerate the process, if not indeed force a settlement that is finally acceptable to both parties. I am very hopeful that this will happen and will happen soon, Shalaby said.
Shalaby made clear that he, as an Orascom representative and chairman of the board, was not directly involved in the talks.
Shalaby said the management or board structure of the firm would likely change as a result of the talks, but the settlement would retain both as significant shareholders.
He said such a resolution would enable the long-discussed sale of Orascom’s internet service provider, LINKdotNET, to Mobinil. -Reuters
