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Egypt starts gov't IPO scheme with Eastern Co’s additional 4.5% stake

Egypt starts gov't IPO scheme with Eastern Co’s additional 4.5% stake
The state-run IPOs aim to develop the Egyptian capital market and attract liquidity to the EGX
Eastern Co
EAST
2.12% 10.60 0.22
EFG Hermes
HRHO
6.52% 12.90 0.79

Cairo – Mubasher: The Egyptian finance minister on Thursday announced the launch of government initial public offerings (IPOs) programme by floating a further 4.5% stake in Eastern Co on the Egyptian Exchange (EGX).

NI Capital, the consultant of the state-run IPOs, has picked up the leading investment bank EFG Hermes to manage Egypt's monopoly cigarette maker's additional offering, Mohamed Maait said in a statement.

The state-run IPOs aim to develop the Egyptian capital market and attract liquidity to the EGX, as well as provide promising investment opportunities, particularly for young investors, which will consequently boost investment volume in securities and strengthen the EGX’s position as one of the best-emerging stock exchanges, the minister reiterated.

The 4.5% stake of Eastern Co is expected to be sold for nearly EGP 2 billion, he said, pointing out that the EFG Hermes will set the best time for offering the stake.

He stressed that the government is working on implementing the IPOs anticipated to take place in the fourth quarter of this year in a bid to boost daily trading volume on the Egyptian bourse and to provide required financing for future expansion and development plans.

The EGX’s indicators are likely to reflect the success of Egypt’s reform programme over the coming period, Maait projected.

The government IPO scheme will help boost market capitalisation of the local bourse, in addition to luring further investments, he said.