By Ahmed Allam:

Cairo – Mubasher: Emaar Misr for Development, the Egypt-based subsidiary of UAE’s property firm Emaar, began trading on Cairo bourse at EGP 3.71 per share, which is below the offering price.

Emaar stock erased its early gains on Sunday, ending 2.4% lower at EGP 3.71.

Emaar Chairman Mohamed Alabbar said, “Proceeds from the IPO will be directed to allow the company to carry out its ambitious growth plans, which reflect our confidence in the strong potential of the Egyptian economy. This listing is the outcome of our strategic approach to providing both institutional and retail investors the opportunity to invest in and gain exposure to the solid domestic market.”

The stock recorded active trading, after more than 77 million shares were exchanged in 6,927 transactions at a turnover exceeding EGP 303.9 million.

The company set allotment ratio at 2.78% per subscriber.

The company offered 600 million shares worth EGP 2.3 billion in both public and institutional tranches. The offering represents approximately13% of the company’s post-IPO capital.

A total of 510 million ordinary shares were offered in an institutional tranche through a book-building process, while a further 90 million ordinary shares were allocated to the public tranche. EFG Hermes and JP Morgan acted as joint global coordinators and joint bookrunners for the initial public offering.

EGX Chairman Mohamed Omran said the record coverage of Emaar share offering is a clear demonstration of rising investor confidence not only in the company’s performance and overall market conditions, but also in the potential of the Egyptian economy.

“Emaar Misr offering has witnessed the largest oversubscription level in Egypt since the global financial crisis,” Omran said, adding that approximately EGP 21 billion in equity has been raised on the EGX since June 2013.

Translated by Sayed Abdel Rahman