Holding Company For Construction To Offer Majority Stakes In Subsidiaries

3/12/2024 11:12:20 PM

(MENAFN- Daily News Egypt) Daily News Egypt has learned that the Holding Company for construction and Development (HCCD) is set to offer majority stakes in three of its subsidiaries-Al-Nasr housing and Development, Maadi Company for Development and Construction, and Misr Concrete Development Company. This move is part of the government's initiative to launch initial public offerings (IPOs).

HCCD is transitioning these companies from the public sector Law 203 to the corporate Law 159 framework, preparing them for either strategic investment or listing on the Egyptian Exchange.

This transition is designed to attract private sector investment and is a key component of the companies' broader restructuring efforts. The restructuring is slated for completion within the current year, with the IPOs anticipated in 2025. This will coincide with the sale of an additional stake in the New Urban Communities Authority, as HCCD aims to decrease its holdings and enhance the private sector management of these entities.

The divestment is part of a broader strategy to implement the state ownership policy, fostering private-sector partnerships and economic empowerment.

HCCD's portfolio includes 10 companies: five in contracting, one in engineering design and consultancy, three in housing, and one in electrical contracting.

For the past fiscal year, HCCD reported revenues of EGP 1.055bn and profits of EGP 842m. The subsidiary companies secured contracts totaling approximately EGP 42.

During its general assembly, HCCD reviewed its budget and performance indicators. The discussion highlighted challenges, such as 132 stalled projects requiring an estimated EGP 13bn for completion-a figure that may rise. Additionally, a financing shortfall of EGP 2-3bn is projected over the next six months.

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