Cairo - Mubasher: Mashreq Company, subsidiary of Qalaa Holdings, may go into liquidation after it finishes off the cancellation of a franchisee agreement with the General Authority for Economic Zone of the Suez Canal, said source close to the matter.

Earlier, Mashreq Co. said it runs negotiations with the General Authority for Economic Zone of the Suez Canal to cancel franchisee agreement.

Through this agreement, Mashreq was supposed to handle the establishment, management and operating liquid bulk station (2) in East Port-Saied port and redelivering it.

The government plans to pay back nearly 60% of the value of the project's implemented investments that amounts to $35 million, source told Mubasher, speaking on condition of anonymity.

Both Qalaa Holdings and major shareholders agreed on conducting settlement agreement with the government, on condition that they receive a compensation in return for handing over the land to the government, added the source.

The Qalaa Holdings may direct the compensation towards new investments, only after it receives new land plot from the government, pointed out the source.