By Compiled by Sherine Abdel-Razek Foreigners have been supporting the market with heavy buying on both blue chips and small caps. The week ending 21 February, however, witnessed an increased appetite for buying by both locals and foreigners, pushing the CASE30 index 5.1 per cent to reach 10,800 points. The market capitalisation jumped to LE870 billion, the CASE's highest level ever. The overall turnover through the week came at LE14.3 billion, with average daily transactions worth LE2 billion, together with the implementation of the sale of the Egyptian Containers Company at LE3.7 billion. Transactions by foreigners accounted for 44 per cent of overall activity, with their purchases exceeding their selling orders by LE2.4 billion. ORASCOM CONSTRUCTION INDUSTRIES (OCI) finalised a deal with the UAE-based private equity group Abraaj Capital, according to which the latter's fertiliser production facilities will be merged with those of OCI's. The deal is valued at $1.59 billion, which OCI will pay through a combined cash and shares equity consideration. OCI will pay $874.5 million in cash in addition to giving Abraaj a stake of about six per cent in OCI's equity through a capital increase. This includes 12.77 million new OCI shares at a price of $56.3 per share, subject to the approval of OCI shareholders in an extraordinary general meeting. According to an HC Securities report, the merger will result in a huge fertiliser group. It could even be ranked among the world's top five producers of nitrogen-based fertilisers and ammonia, with a total combined annual capacity of 4.2 million tonnes by 2010. Abraaj's possessions in the fertiliser business include a 100 per cent stake in the Egyptian Fertiliser Company, and a 20 per cent stake in the Nigerian Notore Chemical Industries. As for OCI, it has a 30 per cent stake in Egyptian Basic Industries and a 51 per cent share in the Algerian Sorfert Algerie. NATIONAL SOCIETE GENERALE BANK (NSGB)'s net income for fiscal year 2007 came at LE674.2 million, marking a 355.8 per cent jump from its LE147.9 million in fiscal year 2006. This exceptionally strong performance was mainly because of the absence of the LE497.9 million one-off charges which the bank shouldered in fiscal year 2006 to cover the MIBank's employment fund deficit. Moreover, a 25 per cent increase in the bank's net interest income due to strong loan growth contributed to the hike in profits. The bank's operating expenses increased by 15.8 per cent through the year, partly due to the expenses of opening 21 new branches during the year. NSGB's coverage of non-performing loans (NPLs) improved from 84 per cent to 96 per cent in 2007, with the bank's NPLs standing at 11.3 per cent of gross loans in 2007 versus 16.1 per cent a year earlier. The bank is planning to increase its paid-in capital from LE2.75 billion to LE3.03 billion to be financed by its reserves. The capital increase is subject to the approval of the bank's General Assembly meeting to be held on 13 March. COMMERCIAL INTERNATIONAL BANK (CIB) will be lead-managing a LE497 million loan to the real estate company Palm Hills Developments. The loan is offered by five banks, namely Egyptian Arab Land Bank and Housing and Development Bank at LE150 million each; Bank of Alexandria with LE97 million; and Bloom Bank Egypt and Egyptian Saudi Finance Bank ending LE50 million each. The company will use the loan that matures in 3.5 years to expand its developments in 6th of October, New Cairo, the North Coast, Ain Sukhna and Hurghada. On another note, CIB released its 2007 results, posting a net income of LE1.29 billion, 51 per cent up from the LE851.6 million realised in 2006. ORASCOM TELECOM HOLDING (OTH) expressed interest in bidding for Nigeria's fixed-line operator NITEL and its mobile subsidiary M-Tel. The move came after the Nigerian government cancelled the 2006 sale of a 51 per cent stake in NITEL to Transnational Corporation (Transcorp). Bloomberg news agency said that the cancellation was due to "Transcorp's mismanagement, its failure to make considerable investments and its inability to turn the company around as had been agreed when it bought." Three other international companies, Messers Telekom of South Africa, Vodacom and France Telecom, are also interested in NITEL. Meanwhile, OTH is currently in negotiations to have a syndicated loan to refinance the $2.56 billion loan it acquired in 2006. Compiled by Sherine Abdel-Razek
