(AFP Photo)
The General Investors Federation plans to put 60% Suez Canal Holding shares worth EGP 1bn to an Initial Public Offering (IPO) in two months, said Mohamed Farid Khamis, founder of Oriental Weavers.
“The new company will help implement development projects on both sides of the Suez Canal Axis,” Khamis said. “We aim to fund the remaining 40% with contributions from businessmen.”
Khamis went on to explain that he consulted both the chairman of the Egyptian Exchange and head of the Suez Canal Authority. He also said that “the value of one share will not exceed EGP 10”.
Mohamed Omran, chairman of the Egyptian Exchange, confirmed that he received a phone call from Khamis. They discussed the federation completing a financial and economic feasibility study for five years ahead as a condition for the Egyptian Exchange allowing preparations to begin for the IPO bulletin, he said.
Khamis said that an agreement has already been made with a financial adviser who will lead the feasibility study to be implemented by the new company. However, Khamis said: “Feasibility studies are subject to Dar Al-Handasa finishing the general outline of the of the Suez Canal Axis Development project. I called Vice Admiral Mohab Mamish, head of the Suez Canal Authority, who stressed that Dar Al-Handasa is close to finishing the general outline and it will be completed within two months.”
During the opening of the Akhbar El Yom Economic Conference Sunday evening, Khamis told Daily News Egypt the study would be completed by Baker Tilly and Wahid Abdul Ghaffar & Co. The study’s goal is to analyse the most important canal projects, with their expected profits to be calculated for the next five years from the date that canal excavation is completed.
Khamis asserted that investment incentives and exemptions are not up to par in Egypt, and called the administration to rapidly take care of legislative flaws that impede local investors. He added that this must take place as promotional activities undertaken to attract overseas capital. Another requirement includes improving business practices by speeding up litigation, licensing and providing of land, he said.
Khamis further said that the federation’s contribution to the Suez Canal project is not for the purpose of gain, but rather represents a contribution to the project’s implementation. The project is estimated to raise the canal’s revenues to EGP 60bn.
