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El Sewedy to build $150 mln plant in Qatar Egypt-based El Sewedy Cables said on Monday it would build a $150 million power cable plant in Qatar with a local partner to tap surging Gulf Arab infrastructure spending. The factory will have an annual production capacity of 30,000 tons, with most of it to be …


El Sewedy to build $150 mln plant in Qatar

Egypt-based El Sewedy Cables said on Monday it would build a $150 million power cable plant in Qatar with a local partner to tap surging Gulf Arab infrastructure spending.

The factory will have an annual production capacity of 30,000 tons, with most of it to be sold in the local market, and will start operating in the end of 2009 or early 2010, El Sewedy said in a statement.

With the number of new infrastructure projects planned, we believe that our presence in Qatar is critical to enable us to capitalize on this growth potential, Chief Executive Ahmed El Sewedy said.

El Sewedy, the largest publicly traded Arab cable producer, said it would own half of the project and Qatari-based Aamal Holding would own the rest.

It said 60 percent of the project would be financed with medium-term loans and the rest with equity. Imported machinery and raw materials that do not exist in Qatar would be exempted from custom duties, Sewedy said.

El Sewedy is currently building cable factories in Algeria and Saudi Arabia and expects operations in both to start during the second half of 2008.

The company posted a 78 percent increase in first-quarter net profit after tax and minority interest to LE 260 million ($48.6 million), with revenue from factories outside Egypt constituting 20 percent of total revenue, up from 12 percent in the first quarter of 2007.

During the quarter El Sewedy increased its stake in the Slovenian electrical meter company Iskraemeco to 97.6 percent from the 68.3 percent stake it bought in November. -Agencies

Gaz de France finds gas in Egypt

Gaz de France said on Monday it discovered natural gas deposits in the West El Burullus concession in Egypt where it holds an exploration and production license.

The license, covering a total area of 1,364 km2, concerns an offshore concession in the Mediterranean to the northeast of Alexandria.

Dana Petroleum holds a 50 percent interest in the discovery and license area and Gaz de France owns the other 50 percent stake and operates on behalf of the group.

Insurance Holding Co. transfers Talaat shares, says report

The Insurance Holding Co. transferred the ownership of 73 million shares in Talaat Moustafa Group Holding to Misr Insurance Co. as part of its restructuring plan, Al-Alam Al-Yom reported.

The Insurance Holding Co. transferred the shares, which represent 3.6 percent of Talaat Moustafa, at LE 11.6 per share, the Cairo-based business newspaper reported, without saying where it got the information. -Bloomberg

Eye on the market

El Sewedy Cables announced that the feasibility study for its previously announcement copper smelter plan will be delayed until the end of the year, citing a heavy workload at existing factories. In its daily market report, Beltone Financial said, “The delay of the project, which was previously said to cost $850 million, and of which El Sewedy Cables has a 74 percent share, is understandable for two reasons. First of all, the project was meant to be tax free as it is a free zone project. It is still unclear as to whether a tax exemption would apply to the project in light of last month s parliamentary decisions, which included a removal of free zone status from energy-intensive industrial operations.

“Secondly, with rising construction costs, it makes sense that the project assumptions be revised in terms of required return. Although we ultimately view the project as beneficial in the long term in terms of cost savings, we were always wary of the large CAPEX ticket associated with the project, and we can still view the company positively in the absence of the smelter, pending the final decision of the feasibility study.

The Ministry of Trade and Industry decided to extend the ban on rice exports until the end of April 2009, beyond the previously announced October 2008, reported Al Mal newspaper. The government will also start in June disbursing the additional rations of sugar, rice and edible oils to around 40 million citizens, registered through 11 million ration cards. The additional rations will be partially financed by the fiscal measures announced on May 5.

Average yield rises on 91-day Egypt T-bills

Reuters reported that the average yield on Egyptian 91-day treasury bills rose to 9.66 percent at an auction on Sunday from 9.21 percent at the last auction on May 18.

The central bank said it accepted bids for bills worth LE 1 billion, the same amount it was seeking. It accepted bids at rates between 9.002 and 9.872 percent, compared to a range of 9.052 to 9.451 percent at the previous auction. The bills are for issue on June 3 and they mature on Sept 2. -Agencies

Beach seeks US$181 million equity for Egyptian assets

Energy Current reported that Australia-listed Beach Petroleum Ltd. is seeking to raise $181 million from an institutional share placement to fund the purchase of three onshore and offshore Egyptian assets that may add eight million barrels of proven and probable oil reserves to the company s portfolio in the next financial year.

Late last month, Beach entered into agreements to acquire between 20 to 25 percent interests in the offshore North Shadwan and South East July concessions and onshore North Qarun concession in Egypt.

The purchase of the 20 percent stake in the North Shadwan concession from TriOcean Energy is subject to a pre-emptive right in favor of BP Exploration (Delta) Ltd. that will expire on June 28.

The total acquisition costs of the three Egyptian assets including development expenses will be about $143 million.

Beach expects to complete the $181 million institutional share placement by June 12. The placement will be managed by ABN AMRO Equity Capital Markets Australia Ltd. and Euroz Securities Ltd. Adelaide Equity Partners Ltd. is the advisor for the fund raising exercise.

In addition, Beach will also offer eligible shareholders an option to subscribe for up to $4,763 worth of shares through a share purchase plan at the same price as the institutional placement. All new and existing shareholders will also be entitled to participate in a one for 10 bonus options issue, with an exercise price of $1.91 per share before June 30, 2010.

Topics: FJP
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