Egypt is preparing to announce a considerable program of public offerings soon and is putting the final touches ahead of providing a comprehensive program with international standards that attract investments.
During the past months, authorities postponed several IPOs because of bad timing during a widespread economic downturn or a disagreement between the Egyptian government and foreign investors on the offerings.
The currency value is the biggest reason for the recent disagreements. A wide gap between the dollar price in the official and parallel markets, which sometimes reached about 30 percent, played a significant factor in the divergence of views.
Official ministerial sources revealed to Asharq Al-Awsat that extensive work is underway to bridge the gaps that hindered understanding of the IPO program.
The sources that asked not to be named indicated that the final details are being worked out on the comprehensive program, which will be presented during a huge conference under high-level sponsorship.
Cairo needs to accelerate the program of government offerings amid a stressful economic situation due to the decline of foreign reserves, and before the due dates and interests of some of the debts.
According to the data, the proposals program may include about 32 state-owned companies in stages during the coming months, including three banks, four government real estate companies, several hotels under government management, and insurance, energy, and transportation companies.
The offerings could reportedly be led by the army-owned Wataniya and Safi companies, perhaps during the month of July.
Meanwhile, the head of the Egyptian Stock Exchange (EGX), Rami el-Dokany, indicated in a televised statement that there are talks with an extensive list of private companies to be listed on the stock exchange.
Dokany pointed out the focus on companies that have dollar resources, export their products, or work in energy and tourism.
However, Bank of America's head of EMEA equity capital markets, James Palmer, said he believed foreign investors continue to have appetite for Middle East IPOs.
"The pipeline is encouraging although we are not expecting a huge wave for the second half. Many situations are more focused on early or mid next year, rather than the back end of this year," said Palmer.
Some Middle Eastern issuers "feel very good about a belief in the structural shift in the region, broadly defined; that is, the commitment in the region to develop and advance the capital markets, and commitments from local entities to show financial support for them," he added.
