Egypt eyes $6 billion stake sale in state businesses

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Egypt eyes $6 billion stake sale in state businesses

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Egypt aims to raise $6 billion by selling stakes in state-owned businesses before the middle of next year, as it seeks to shore up an economy hit by Russia's invasion of Ukraine.

The program may include share offerings to the public, or block sales to strategic investors, and will be supported by the country's sovereign wealth fund, Hala Elsaid said in an interview in New York. She didn't identify which companies might be sold.

Egypt wants to bring in more foreign direct investment - while also negotiating a new loan with the International Monetary Fund -- after taking a hit from soaring food and fuel import bills as a result of the war in Ukraine. Since March, there have been $22 billion in outflows from the local debt market.

Read more: Egypt Talks China, Japan Loans, IMF Deal Needs Month or Two 1 The North African nation promises a wider overhaul that sees the state play a smaller role in the economy, in line with IMF policy advice.

The Abu Dhabi wealth fund ADQ and a unit of the Saudi Arabian Public Investment Fund have already pumped roughly $3 billion into Egypt, snapping up government-held stakes in prominent companies under deals that were facilitated by the Egyptian sovereign fund.

Read more: Saudi Arabia s $10 billion pledge to Egypt Delivers First Deals

More such agreements are expected to be reached, possibly including the sale of stakes in some firms held by Egypt's army.

Elsaid said that additional sovereign wealth funds in the Gulf and elsewhere will be approached, and there is a plan for a roadshow in Europe and Asia at the end of October to show the investment opportunities in Egypt.

She said that sovereign wealth funds add value in terms of expertise, finance and technology, because they are usually long-term investors.

Egypt has set up a pre-IPO fund that aims to restructure state-owned assets and prepare them for stake sales.

Elsaid said that the target is to transfer assets worth as much as $3 billion to the fund within three to six weeks, including a power plant built by Siemens AG.

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