The Financial Supervisory Authority has authorized the Ministry of Finance, as the main shareholder of Telecom Egypt, to sell 10% of the company’s shares on the stock exchange, according to a statement published on the website of the Egyptian Stock Exchange.
After the implementation of the sale agreement, the Egyptian government’s share in Telecom Egypt was reduced from 80% to 70%, while the remaining percentage is traded on the stock exchange.
The sale of a stake in Telecom Egypt is a long-awaited first step in offering government and armed forces-affiliated companies to the exchange under the so-called Government Bid Program, which aims to help the government to bridge the financing gap and attract foreign investment, with the worsening hard currency shortage crisis.
Telecom Egypt was not among an initial list of 32 state-owned and armed forces companies that the government intends to offer, either through the stock exchange or through private transactions for strategic investors.
It should be noted that Telecom Egypt is one of the 4 companies that provide telecommunications services in Egypt, and the other three companies are Vodafone, Orange and Etisalat, and Telecom Egypt owns 45% of the shares of “Vodafone Egypt”.
Egyptian Prime Minister Mostafa Madbouly said in late April that the government was aiming to reach $2 billion from the government bid program before the end of next June.
The government bid program is of great importance to the International Monetary Fund, which has approved a new loan to Egypt worth $3 billion, of which only a small tranche has been disbursed, as it considers essential to help Egypt close the financing gap and increase the country’s dollar revenues, while giving a greater place to the private sector in the economy.
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