The market gained momentum on the week ending 30 August after recovering the losses caused by a hiccup in US mortgage markets. The Case30 Index gained 2.17 per cent, while market net average daily turnover came in at LE875 million -- 10 per cent higher than the previous week. The release of positive economic indicators supported the upward trend. According to the Ministry of Economic Development, Egypt's economy grew by 7.1 per cent in Fiscal Year 2006/2007. This represents a slight increase in growth from the FY2005/6 figure of 6.8 per cent. Meanwhile, foreign direct investment increased by 82 per cent in 2006/2007 to $11.1 billion, from $6.11 in FY2005/2006. Al-SEWEDY CABLES, the regional leading cables manufacturer, will sign a contract with Egypt's Industrial Development Authority (IDA) at the end of this month to develop two million square metres of land by building industrial facilities in the 10th of Ramadan City. The ownership of the land will be divided between Al-Sewedy and SIAC, an Egyptian company for industrial construction and engineering. The agreement comes as the first step to implement a deal between Al-Sewedy and SIAC with the Indian industrial group, TATA, to design the industrial zone and organise a local and international promotional campaign to attract $2 billion in investments in cable, transformer and electrical product factories. On another front, Al-Sewedy chose HSBC bank to finance the construction of its copper smelter on the Red Sea coast. The smelter, to be called Red Sea Copper, is a joint venture with Swiss-based Glencore International. The bank is already preparing the documentation for the project's financing, which is expected to be 70 per cent debt and 30 per cent equity. Red Sea Copper will be 74 per cent owned by Al-Sewedy and 26 per cent by Glencore, and is expected to produce 300,000 tonnes of copper cathodes annually, as well as other by-products. The company has a plan to double its annual cable production capacity to 283,436 tonnes by 2011 through expansions in its existing facilities, in addition to new plants in other African and Arab countries such as Zambia, Libya and Saudi Arabia. ORASCOM TELECOM HOLDING (OTH) made many headlines through the week since its chairman, Naguib Sawiris, is currently in talks to sell up to 20 per cent of Weather Investments to a group of private equity funds. The group includes Blackstone Group, TPG, Ripplewood Holdings and Permira Advisers. According to Bloomberg news service, Sawiris might sell to private funds instead of an IPO because of current conditions in credit markets. Weather owns Wind Telecomunicazioni, the Italian telecom operator, in addition to a majority stake in OTH. In another development, OTH signed a joint venture agreement with Korek Telecom, the Kurdish operator which was granted one of the three long-term mobile licences in Iraq. OTH would merge the assets of Iraqna, the network it formerly operated in Iraq, into the joint venture which will be 70 per cent owned by OTH and 30 per cent by Korek. The value of the new entity is estimated at $2.2 billion. According to the agreement, Korek Telecom has the right to buy 18 per cent more in the joint venture before 2 November, 2007, while OTH has the right never to reduce its holdings to less that 51 per cent. OTH had dropped out of the bidding process for Iraq's mobile license after the value reached as high as $1.25 billion. According to an OTH press release, the new entity will have four million subscribers; 2.8 million Iraqna subscribers and 1.2 million Korek Telecom subscribers. As a result, the combined assets will have a market share of over 40 per cent, and therefore is expected to be the market leader there. ORASCOM CONSTRUCTION INDUSTRIES (OCI), the regional construction giant, is expanding its activities in Africa by announcing the launch of Mafikeng Cement Company (MCC) in the North West Province of South Africa. MCC will build and operate a state-of-the-art cement plant with an annual production capacity of two million tonnes. OCI owns 67.5 per cent of the company and the rest is owned by South African investors. The cost of the new project comes at $440 million and is expected to begin production by 2010. With the addition of MCC, OCI Cement Group will achieve an annual production capacity of 44 million tonnes by 2010. OCI is also competing with five companies to renovate cement plants in Iraq at a total cost of $500 million. OLYMPIC GROUP (OG) announced that it will not be buying the assets, inventory or brands of Al-Abd for Electrical Appliances, contrary to an agreement signed last month. OG will only buy the assets of Al-Abd Industrial Co. (including its brands Al-Abd Hi-Tech and Al-Abd Guaranteed) for LE38.5 million. According to OG, the amendments will save it about LE65 million and will not affect OG's agreement with Electrolux to become its sole distributor in Egypt starting January, 2008. Al-Abd Industrial is licenced to produce refrigerators and dishwashers for Zanussi-Electrolux, but has not yet begun production. AL-AHLI UNITED BANK EGYPT (AUB) posted an 11 per cent increase in its net profits for the first half of 2007, to reach LE82 million. This came on the back of a 28 per cent hike in banking income to LE130 million, after net interest income and non-interest income grew by 35 per cent and 16 per cent, respectively. Deposits increased by two per cent to reach LE3 billion. AUB is 89.3 per cent owned by Bahrain's Al-Ahli United Bank and 10 per cent by the International Finance Corporation, formerly known as Delta International Bank Compiled by Sherine Abdel-Razek
