Egypt has sold a stake in tobacco products maker Eastern Co. This is the first foreign sale of a major state asset since it agreed to a privatisation programme with the IMF last December, reports Reuters.
The buyer was the UAE’s Global Investment Holding Co., Eastern CEO Hani Aman confirmed to Reuters on 16 November.
Global Investment bought 30 per cent of Eastern, or 669 million shares, for EGP 16.40 billion (USD 531.60 million), or EGP 24.51 pounds per share in a transaction executed on the stock exchange on 16 November.
The buyer also agreed to pay an additional EGP 4.38 per share, bringing the total purchase value at USD 650 million, the Ministry of Public Enterprise said in a statement forwarded by EFG Hermes, which acted as adviser on the transaction. An additional EGP 2 billion of assets were also taken out of Eastern Co. and retained by the government holding company in agreement with the buyer, the statement added.
The cabinet announced in early September that Global Investment had agreed to buy the stake for USD 625 million from state-owned Holding Company for Chemical Industries, which held 50.95 per cent of Eastern’s shares.
The sale reduces the government’s stake to 20.95 per cent and gives impetus to Egypt’s floundering privatisation programme, the report said.