By Sherine Abdel-Razek By mid-week a spate of profit-taking had taken its toll on the market though it later made some gains on the back of increased liquidity and a decline in interest rates. Market analysts welcome the retreat in share prices as a necessary readjustment. The value of this week's transactions reached LE9.34 billion, one of the highest ever. Gulf investors seemed particularly active following the recent bullish trading cycle in Gulf countries during which share process have sky- rocketed. Moves by local banks to lower interest rates have also made shares more attractive. The Central Bank of Egypt (CBE) last week lowered its discount rate by one per cent -- down 10 per cent to nine -- for the first time in three years. "Corridor" rates were also reduced: the deposit rate dropped 0.5 per cent to 8.25 while the lending rate fell from 10.25 per cent to 9.75. The discount rate, used by the CBE as a benchmark in pricing loans to state, is closely watched by the market. In the wake of the CBE move many local banks lowered their own rates in an attempt to boost investment. ORASCOM TELECOM HOLDING: The week witnessed the 1:2 split of the company's shares in a move aimed at increasing liquidity. Shares started the week at LE371.8 and ended at LE373.43. Meanwhile, the Nigerian government cancelled the sale of Nigeria Telecoms (NT), its fixed line operator, to OT. OT had offered $256.5 million, lower than the undisclosed minimum bidding price set by the Nigerian government. This is the second time that NT has been offered for privatisation. In 2002 the sale faltered because of the minimum bidding price set by the government. AL-WATANY BANK OF EGYPT: The bank's general assembly approved an increase in paid-in capital from LE750 million to LE1 billion. An additional 16.4 million shares are now expected to be offered to existing shareholders at an allocation rate of 50 per cent and priced at LE15.25 a share. The bank's better than expected results for the first nine months of 2005 -- the result of a major restructuring -- saw shares surge by an impressive 190 per cent during the last year to end on LE29. EGYPT KUWAIT HOLDING COMPANY: EKHC was this week's biggest gainer as its shares surged by 48 per cent to close at $4.64. Its performance came on the back of news that the company is in the final stage of valuing the 36.2 per cent government stake in the Egyptian Financial and Industrial Company which EKHC is chasing to consolidate its position in the fertilisers market. EKHC also announced that one of its affiliates has established a new company, Tri-Ocean Energy, with issued capital of $300 million, in association with other banks and investors. MISR ALUMINUM: The Holding Company for Metallurgical Industries, Misr Aluminum's parent company, announced that a 17 per cent stake in the latter will be offered before mid-February. A seven per cent stake will be offered to the public with the rest sold through a private placement. Misr Aluminum this year embarked on a five-year development plan costing LE1.5 billion and financed exclusively in-house. MIDOR: Ten local and international investors have applied to act as underwriters for the privatisation of 20 per cent of the Middle East Oil Refinery MIDOR -- in the form of an IPO -- scheduled for the second half of 2006. The refinery, which came on stream in April 2001, has a capacity of 100,000 barrels per day. Originally a joint venture between Egyptian and Israeli partners, Israel withdrew in June 2001. The Egyptian General Petroleum Corp (EGPC) has a 40 per cent controlling interest, while its engineering subsidiaries Petrojet and Enppi each have 10 per cent. MIDOR is expected to attract a lot of attention given the strong demand for shares in the two oil companies -- SIDPEC and AMOC -- currently quoted on the market. COMMERCIAL INTERNATIONAL BANK: In the three trading weeks that have passed since the expiry of the deadline set by the National Bank of Egypt to reveal the new owner of its 19 per cent stake in CIB, the bank has lost much ground. It was rumoured that the American Rebel Wood Group and the British-based ACT had both made offers. Meanwhile the bank posted its results for fiscal year 2005 showing a 20.6 per cent gain in net profits to reach LE610.1 million. Net interest income grew by 26.4 per cent. ORASCOM CONSTRUCTION INDUSTRIES: OCI announced $250 million worth of investments in the Turkish cement sector, including the acquisition of a cement plant in eastern Turkey. The plant, which has a capacity of 0.6 million tonnes of cement annually, will cost OCI $54 million. OCI has also acquired 20 per cent of Baticim Cimento, with a capacity of three million tonnes of cement and 2.2 million tonnes of clinker, for $54.7 million. It is also negotiating with a Turkish partner to produce another three million tonnes annually. Samih Sawiris, OCI's CEO, said in a company press release that Turkey is a natural extension of OCI's core geographic market around the Mediterranean rim. Growth prospects are good, and it has emerged as one of the Mediterranean's biggest cement markets following a double-digit increase in consumption which rose by 14 per cent between January and October 2005. Compiled by: Sherine Abdel-Razek
