CAIRO - After a Cairo court annulled a 2006 deal to sell Omar Effendi department store chain to a Saudi investor on Saturday, experts say the mega store will face "four possible scenarios". These scenarios will be based on "overall restructure to maximise the State's revenues and preserve labour right's", the official Middle East News Agency (MENA) reported on Sunday. "In the first scenario, the Government may keep the company as it is and will put for sale again," one analyst told MENA. "In the second scenario, it may restructure the company then re-sell it, or appoints qualified management to run the department store chain for the State. The fourth scenario includes restructure and selling a stake in the country's Bourse through an initial public offering (IPO)," MENA said, citing experts. "The firm requires small funds for restructure to fix problems incurred by the previous administration," said Hamdy Fakhrany, an engineer who successfully challenged State the sale of the mega store. Omar Effendi, a well-known chain with branches in every big town across Egypt, was founded more than 150 years ago and nationalised in 1957. Saudi firm Anwal bought a 90 per cent stake in Omar Effendi for LE589.5 million in 2006 as part of a privatisation plan under the rule of former president Hosni Mubarak, who was toppled by a popular revolution on February 11. "First of all, Omar Effendi's management should be changed. In the short term, the comapny should be restructured financially and technically under the current circumstances as the retail sector is facing serious problems: a slump in domestic spending and growing competition," said Mohsen Adel, a Cairo-based financial expert. "Restructuring Omar Effendi will cost aounbd LE300 ($50.2m)-LE500 million to revamp branches and buy inventory," Adel added.
