The attack that took the lives of 21 Copts in Alexandria on New Year's Eve overshadowed market transactions in the first week of 2011, putting the market in the red on Sunday and Monday. This came as a contrast to the enthusiastic end of 2010, which witnessed the EGX30 exceeding the 7,000 point threshold for the second time in nine months. Things on the macroeconomic front were encouraging. A report by the Economist magazine placed Egypt among six states scoring notably high growth rates during the coming decade. The list included Colombia, Indonesia, Vietnam, Turkey and South Africa as well as Egypt. The report said these countries have very promising chances for long-term growth. Meanwhile, figures published by the Ministry of Finance showed that the overall public budget deficit from July to November reached 3.9 per cent. The government is aiming for a deficit of 7.9 per cent for the whole of fiscal year 2010/ 2011. Revenues from taxes increased by 11.6 per cent, also from July to November. The report mentioned that this increase is attributed to higher revenues from sales taxes on goods and services that rose by 16.4 per cent to reach LE27.1 billion, compared to LE23.3 billion during the same period last year. ORASCOM TELECOM HOLDINGS (OTH): The company denied news reports that it has already resorted to international arbitration to resolve its dispute with the Algerian authorities around Djezzy, the Algerian arm of OTH. A company spokesperson said such a step would need the approval of its board of directors, which has not yet been given. After aborting a deal between South Africa's MTN group and OTH under which the former would have bought Djezzy for $7.8 billion, the Algerian authorities refused to negotiate with Russia's VimpelCom, which tied the knot with OTH's parent company Weather, two months ago. The Algerian government said it wanted to nationalise Djezzy. In a new development on this front, the Algerian government chose an American adviser for the procedures of purchasing Djezzy at a contract value of 1.8 million euros. The terms of the contract will be announced next week. RAYA HOLDING FOR TECHNOLOGY AND COMMUNICATIONS: The company sent a release to the Egyptian Stock Exchange stating it will buy a 30 per cent stake in 10 Ramadan city for Pharmaceuticals and Diagnosing products (Ramida). The decision came after Raya's board of directors approved the feasibility study undertaken by Ernst and Young regarding this issue. The total value of the deal, comprising 120,000 shares of the drug-maker, comes to LE214.8 million. The firm, which sells mobile handsets, runs call centres and builds smart buildings, said last quarter it is eyeing an expansion into renewable energy and pharmaceuticals. EZZ STEEL REBARS: Egypt's largest steel producer decided to increase its steel rebars prices for January by LE350 so that the ex-factory price reaches consumers at LE4,350 per tonne, compared to LE4,510. The price increase stems from the hike in international billet prices, billet being the raw material used in steel production. Commenting on the move, Beltone Financial said it comes as no surprise, given the increasing pressures of higher iron ore billet costs. Billet prices as per Vale's, Ezz's main ore supplier, increased by close to 200 per cent year on year. Beltone expects this increasing input cost trend to have a significant impact on Ezz Steel's margins in the short term, given the inelasticity of steel prices at a higher rate of billet costs. EGYPTIAN COMPANY FOR MOBILE SERVICES (MOBINIL): Subscriptions for the company's loan arranged by Banque Misr, equivalent to LE390 million, are closed. This loan is the second phase of a credit facility the company obtained the first tranche of a year ago. The value of the first tranche was LE610 million. Six local banks subscribed to the new loan with a total value of LE860 million. As the loan arranger, Banque Misr will allocate the final quotas for the sharing banks in the loan. Meanwhile, the company's chief financial officer said the number of subscribers to Mobinil's telephone services has now reached 30 million. ORASCOM CONSTRUCTION INDUSTRIES (OCI): Last week the largest listed construction company's shares rose to their highest in more than two years, after a consortium it belongs to was shortlisted to bid for the development of a solar energy project in Morocco. On 29 December, OCI shares reached LE287.11, the highest since September 2008. The stock gained 15 per cent during 2010. CI Capital, the local investment bank, said the project adds to Orascom's growing backlog in North Africa and helps diversify the company's portfolio beyond Egypt and Algeria. Morocco's Agency for Solar Energy shortlisted four groups out of 19 applicants to bid for the development of the first phase of a 500-megawatt solar energy project in the country's southern region. Compiled by Sherine Abdel-Razeq
