Dubai, Reuters—Egyptian private equity firm Citadel Capital has won regulatory clearance to ask shareholders to approve a capital increase, it said on Sunday, underlining a more confident mood on local markets.
If the EGP 3.64 billion (USD 528 million) share issue goes ahead, it will be one of the biggest in Egypt since its 2011 revolution.
Citadel, which has struggled with losses over the past two years, originally requested regulatory approval for the share sale last year. But like many business plans during the chaotic administration of Islamist president Mohamed Mursi, it did not go ahead because of bureaucratic obstacles and poor market conditions.
Mursi was ousted by the army after popular protests in early July.
The company will now hold a shareholders’ meeting to propose issuing 182.1 million preferred shares and 546.3 million common shares at a par value of EGP 5, raising its total number of shares to 1.6 billion and paid-in capital to EGP 8 billion.
The money raised would be used to boost Citadel’s ownership to between 51 and 100 percent in most of the major companies in which it invests, particularly in the energy, transport, agriculture, mining and cement sectors, it said.
Other investors and partners in these firms would be given a chance to become shareholders in Citadel. Meanwhile, the company plans gradually to sell off its non-core investments over a period of at least three years.
Citadel, which says it controls investments worth USD 9.5 billion, posted a group net loss of EGP 702.4 million in 2012, after a loss of EGP 800.5 million in 2011.
The company’s shares were trading up 0.9 percent at EGP 3.30 around midday on Sunday, down 13 percent since the end of last year.