New crude oil discoveries last…
Russia has effectively reached its…
Egyptian authorities intend to start their initial public offerings (IPOs) program with state-held oil companies, in a plan to raise US$10 billion from listings in three to five years, Bloomberg reported on Monday, quoting Egypt’s Minister of Investment Dalia Khorshid as saying in an e-mailed reply to questions.
Currently, the government is reviewing which companies would take part in the IPO program, and many firms will be restructured in view of their respective listings, beginning with electricity firms, Khorshid noted. Apart from oil companies, state-held banks are also up for privatization.
Part of the proceeds that Egypt will reap will be used to narrow its budget deficit, one of the largest in the Middle East.
Last month, Egypt reached a tentative deal with the International Monetary Fund (IMF) for a US$12-billion loan, in exchange for reforms, to help it narrow its budget deficit, restore investor confidence, and bolster growth. Government debt is expected to drop to some 88 percent of GDP in 2018/19 from 98 percent in 2015/16, the IMF said.
Most recently, officials have said they were close to meeting the IMF requirements for a first tranche of the loan.
Now, Egypt expects to list two or three state-held firms in the first year of the IPO program, Reuters reported on Monday, citing Ashraf El-Ghazaly, chief executive of government-owned NI Capital.
Last month, Egyptian Oil Minister Tarek El Molla said that the government had sent the names of eight petroleum companies to the Ministry of Investment to be studied, paving the way to issuing some of their shares on the bourse or increasing their capital.
“Among the names we are studying are Middle East Oil Refinery (MIDOR) and the Egyptian Ethylene and Derivatives Company, and we are considering a capital increase for companies Alexandria Mineral Oils Co., MIDOR, and Misr Fertilizers Production Company,” El Molla said.
Egypt, which has recently enjoyed major oil discoveries, also aims to increase its natural gas production by 30 percent by 2019. Some of the major foreign players in Egypt’s oil and gas business include BP, Italy’s Eni, and Apache Corporation.
By Tsvetana Paraskova for Oilprice.com
More Top Reads From Oilprice.com:
Tsvetana is a writer for the U.S.-based Divergente LLC consulting firm with over a decade of experience writing for news outlets such as iNVEZZ and…