Cairo – Mubasher: The European Bank for Reconstruction and Development (EBRD) has enticed an interest in Egypt’s initial public offerings (IPOs) programme of state-run firms on the Egyptian Exchange (EGX).
The London-based lender is highly interested in the Egyptian government's privatisation process and is keen to purchase shares in some of the state-owned firms and national banks, managing director for the bank’s southern and eastern Mediterranean (SEMED) region told local newspaper Alborsa.
The government IPO programme is still in its early stages, however, financial institutions might be the first sector for the EBRD to buy stakes in, Janet Heckman added.
The bank’s policy isn’t based on holding majority stakes in companies’ stocks, but it is more interested in holding minority stakes in any institution that could add a value, she said.
She added that the European bank could add value to the companies it intends to invest in through helping boost their capital for achieving a further growth, strengthening internal abilities, and enhancing their governance.
The EBRD will pump EUR 148 million into Kitchener drain depollution project, which is a key project for Egypt, Heckman highlighted.
The bank is supporting the North African nation’s private sector, as it is the backbone of the economy, she noted.
The bank has invested around EUR 800 million in 11 projects, and is expected to sign new financings in both the private and public sectors of the financial sector, small- and medium-sized enterprises (SMEs), renewable energy, electricity, and infrastructure within the few next months, she said.
Moreover, the bank has injected up to EUR 4 billion in financings into 85 projects in Egypt, almost 70% of these projects are in the private sector, she noted.
The Arab world's most populous country has been successful in achieving a primary surplus for the first time in 15 years in fiscal year 2017/2018, Heckman remarked, adding that the public debt slumped to 93% of gross domestic product (GDP) from 103% in FY16/17.