FILE - IFC Country Manager in Egypt, Libya and Yemen Walid Labadi
CAIRO – 25 March 2018: Supporting Egypt’s private sector is a priority for International Finance Corporation (IFC) as it invests in several industries, including the financial sector, IFC Country Manager in Egypt, Libya and Yemen Walid Labadi said.
Labadi added to ‘Egypt Today’ that IFC is open to looking into opportunities associated with the initial public offerings of state-owned firms as the discussion about this issue continues.
He also noted that Egypt's recent economic reforms, including the potential privatization of some state-owned enterprises, are an encouraging step and could help unleash the promise of the private sector.
IFC’s investments are designed to help create jobs, expand essential services, like power, and spur economic growth, According to Labia.
Egypt announced in 2016 a program to float some state-owned companies in the Egyptian Exchange under a five-year program to attract investment and invigorate the stock market.
It also aims to increase funding to Egyptian companies and maximize the benefit from state assets.
The Ministry of Finance announced last week that the Egyptian government elected 23 state companies for the first phase of the state IPO program, with a total shares value of LE 80 billion.
Market value of the soon-to-be-listed companies stands at LE 430 billion, the statement said, adding that the government intends to float about 15-30 percent of the companies in the Egyptian Exchange (EGX).
The first phase of the program will include five companies in the petroleum sector, including Enppi, Assiut Oil Refining Co (ASORC) and Alexandria Mineral Oils Company (AMOC), in addition to six companies in the petrochemicals sector, including Sidi Kerir Petrochemicals Co, the Egyptian Ethylene And Derivatives Company, and three companies in the logistics sector.
As for financial services, the listing will include the Housing and Development Bank, Bank of Alexandria, Banque Du Caire, e-finance and Misr Insurance companies, according to the statement.
The real estate sector will have two companies listed, while the customer services and industry sectors will each have one company listed.
The state IPO program comes in light of the economic reform program adopted by Egypt. President Abdel Fatah al-Sisi has directed the government to quickly implement the IPO program and ensure its success.
The Initial Public Offerings (IPO) program is conducted under the supervision of the Ministry of Investment.
It covers a period of three to five years, aiming to offer partial stakes in some state-owned companies on the stock exchange. It will serve as a main tool to attract local and foreign capital flows to Egypt.