The week ending 6 December was one of the market's best in 2007. With the CASE30 breaking the 10,000 points threshold for the first time since its inception, buoyant buying activity pushed the overall value of transactions to LE7.9 billion. The market capitalisation through the week gained LE20.6 billion to reach LE746 billion, which is equivalent to 102 per cent of GDP -- its highest ever level. This unprecedented activity was fed by an obvious interest from foreigners in the market, as well as other regional markets, all showing active transactions through the week. Buying transactions by foreigners on the Cairo and Alexandria Stock Exchange exceeded their buying orders by LE468 million. Good news delivered by a handful of the market's blue chips also supported the upward trend. ORASCOM TELECOM HOLDINGS (OTH) posted a 128 per cent increase in its net profits through the first nine months of 2007, to reach LE7.199 billion. Subscribers in the company's various networks worldwide jumped to 65 million, 47 per cent higher than the corresponding period of 2006. The increase in profits stemmed from LE4.3 billion capital gains it realised from the sale of its 14.2 per cent stake in HTIL for $960 million. OTH bought 19.2 per cent of HTIL in 2005 for $600 million completely financed by bank loans. Moreover, the company finalised a deal to sell 100 per cent of its Iraqi mobile network, Iraqna, to the Kuwaiti MTC-Atheer for $1.2 billion. According to the terms of the deal, OTH will acquire 50 per cent of the deal value within one year and the rest in the following six months. OTH acquired the licence for Iraqna in 2003 and operated the service successfully, according to contracts renewed every three months until mid- 2007. In June, the Iraqi authorities offered three mobile licences at prices which OTH found economically unfeasible and thus withdrew from the bidding process. However, three months later, the company decided to enter a partnership with Korek Telecom, the winner of one of the three licences, to offer mobile services in the Northern Kurdish region of Iraq. OTH decided to withdraw from the partnership later due to differences between the two partners. NASR CITY FOR HOUSING AND DEVELOPMENT shares shot up to exceed the offered LE70 per share, in the wake of news that the UAE- based ETA Star will buy 30.8 per cent of the company. This comes despite the announcement by Beltone Capital and Beltone Financial Investments, together holding the 30.8 per cent stake, that negotiations with the Emirates investor reached a dead end. The company's results for the first quarter showed a 104 per cent increase in net profits to reach LE22.1 million. The increase in profits was based on a spiral increase in real estate prices. The company sells both ready-built residential units and plots of land allocated for urban development. ORASCOM CONSTRUCTION INDUSTRIES (OCI) signed a partnership deal with the French Alstom to build a power station in Algeria. Investments in the station amount to 1.35 billion euros, and has a capacity of 1,200 megawatts. OCI's share of the deal is estimated at 560 million euros and covers mechanical, electrical and civil works. The project augments OCI's position in the power generation field in the Middle East and North African region. OCI won two contracts to set up power generation plants in Egypt through 2007. The deal is not OCI's first in Algeria since it is currently developing the country's largest fertiliser plant, with an annual capacity of two million tonnes. Moreover, it is involved in the construction of a new water salination station. COMMERCIAL INTERNATIONAL BANK (CIB) is still waiting for a report on the feasibility of its merger with the Arab African International Bank (AAIB). The deal's advisors, Goldman Sachs and UBS, are currently studying different scenarios for the merger which will create Egypt's largest private bank in terms of assets, valued at LE65 billion. The ownership structure of AAIB is considered one of the main issues which the advisors are scrutinising. Both the Kuwaiti Investment Authority and the Central Bank of Egypt (CBE) own 49.3 per cent each, and there are minority shareholders with an overall stake of 1.2 per cent. In case of a merger KIA's stake would be a minority, a possibility which the latter refuses. Since announcing the merger plan, KIA has offered to buy CBE's stake in order to block any plan to reduce KIA's holdings in the new entity. BANK OF ALEXANDRIA, which is the first Egyptian public bank to go private, is said to have postponed its planned IPO for 15 per cent of the bank until early next year. Market observers say the reason behind the postponement is that the market is not yet ready to receive such a large offering on the heels of Talaat Mustafa Group's IPO, which absorbed almost 20 per cent of the market's liquidity. Some 80 per cent of the bank was sold to the Italian Sao Paolo Bank in December, 2006, for LE72 per share. This put the overall value of the deal at LE9.3 billion. Results of the first nine months of the bank came lower than the previous year's, reducing the earning per share to LE3.62 per cent compared to LE13.3 in 2006. The bank's senior officials explained the drop as due to the fact that the 2006 figures included one-time profits resulting from the bank divesting some of its investments in preparation for privatisation. Compiled by Sherine Abdel-Razek
