Market trends repeated themselves showing a strong start to the week, a brief depression in the mid-week before rising again due to increased investor appetite in the CASE30. The week ending 7 December saw the index closing 1.6 per cent higher than the previous week, bedding in at 6,663 points. The execution of the Amoun pharmaceuticals sale to a global consortium including Citigroup, Capital International and Concord Investments added LE2.6 billion to the overall market's turnover enabling it to reach a high of LE7 billion. Arab and Foreign buyer transactions increased to LE2 billion. NASR CITY HOUSING made many headlines during the week. A group, including Beltone Capital, Beltone Investments Ltd and Orascom Hotels and Development, increased their bid to buy the company to LE110 per share, but for only 40 per cent of the NCH. However, NCH's mother company, the state- owned National Company for Construction and Development declined the offer, claiming it undervalued the company. The previous week ended with the buy out consortium withdrawing after their offer to buy 100 per cent of the company shares at LE90 per share after the bid only received acceptances from NCH shareholders comprising eight per cent of the total stock. The news helped in pushing the company's share value to exceed LE102 through the week. Commenting on the NCH's deal pricing, HC Brokerage said that it seems that a bubble is building in Egypt as real estate prices lose touch with reality. "As such, we see it as imperative to evaluate real estate companies based mainly on the money they can earn, as opposed to the "value" of their assets, which could be inflated. HC Brokerage put the fair value of NCH at less than LE60 per share based on a Discounted Cash Flow model, which also takes into consideration an unresolved land dispute the company is currently involved in. AL-ARAFA FOR INVESTMENT AND CONSULTANCIES closed subscriptions in the company's capital increase yesterday, 10 days after the cloth and garment manufacturer issued its two tranche offering. The first tranche, representing 22.8 per cent of the capital increase included 17.5 million shares and was offered for public subscription with a maximum share value of $1.31. This is approximately 12 per cent less than the market value of the stock. The remaining 60 million shares were offered through a private placement that targeted institutions and high net worth individuals. Publicly offered shares will stand at a price equal to the private placement price with a five per cent discount. The company is a leading manufacturer of textiles and apparel. It is export-oriented with exports accounting for 88.8 per cent of the company's sales figures. International sales are highly concentrated in the United Kingdom, where they constitute 79 per cent of total export and international sales. Formal wear exports are directed more toward Europe, whereas casual wear exports are directed more towards the US. EFG-Hermes acted as a global coordinator and lead manager of the issue, while Prime Securities and HC Brokerage were co-managers. ORASCOM CONSTRUCTION INDUSTRIES, the Middle East's largest publicly traded cement producer, is adding a new country to its regional presence. The construction conglomerate said it plans to build a $370 million cement plant in Indonesia next year. The plant has a capacity of one million tons per year and will be built in Purwodadi in Indonesia's Java Province. Construction is still pending the authority's approval. Cement contributed 30 per cent to the group's sales figures, allowing it to reach LE3.9 billion. The company has cement operations in Kurdistan, Pakistan, Algeria, UAE, Spain, and Nigeria. NATIONAL CEMENT, the last remaining state-owned company, is soon to go private. According to press reports, quoting an unidentified senior official in the Ministry of Investment, the company is to be up for sale before June 2007. When privatisation plans were revealed earlier this year a lot of companies expressed interest. Topping this list were the Italian Italcementi and the local Citadel group. The company is 94 per cent owned by the government through the holding company for Chemical Industries and has a market share of around eight per cent. The high growth in the construction sector both in Egypt and the Gulf enhances the potential of the cement market. Local production comes in at 35 million tons per year and the market is 85 per cent by owned by foreigners. TELECOM EGYPT (TE), Egypt's fixed line monopoly, said it used the proceeds of selling 4.3 per cent of its holdings in Vodafone Egypt (VFE) to repay a part of its LE4.5 billion syndicated loan. Vodafone Group bought the stake from TE last month for LE1.3 billion. TE received the loan in October from the National Bank of Egypt, Banque Misr and Citibank in order to finance its acquisition of 23.47 per cent of VFE. TE has last week increased its stake in the Egyptian PC producer Centra from 56 to 59 per cent. Centra's turnover reached LE85 million in 2005 and is currently considering regional expansion. Other Centra shareholders include Banque Misr, Al-Ahram newspaper and private sector companies. Compiled by Sherine Abdel-Razek
