Egypt's Alexandria Cement received the go-ahead for a LE 2.45 billion ($442.1 million) rights issue scheduled to begin May 19, the stock exchange said on Wednesday. The transaction will pave the way for Alexandria Cement's main shareholder, Greek cement maker Titan, to sell a 16 percent stake in Alexandria to the International Finance Corporation (IFC) for €80 million ($106.6 million). Titan has been struggling to cope with a shrinking business and to cut debt. Alexandria has a free float of 11 percent, according to Reuters data. Its share price leapt 19.7 percent on Wednesday. It will use the proceeds of the rights issue to buy 95 percent of another Egyptian cement maker, Beni Suef Cement Co., which is also owned by Titan, it said in a Feb. 28 letter to the exchange. Alexandria Cement will pay Titan LE 3.13 billion for the stake, which will increase Alexandria's total stake in Beni Suef to 99.998 percent. Alex will not pay Titan for the Beni Suef shares in cash, but will book it as an outstanding debt to Titan, it said in the Feb. 28 letter. Titan has agreed sell the 16 percent stake to the IFC once that transaction is completed. Titan expects to complete the IFC sale before the end of June, it said last month. Titan last month reported a 41 percent drop in profit in 2009 and slashed its dividend to save cash. Alexandria Cement officials were not immediately available for comment.
