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Al-Ahram Weekly 4 - 10 May 2000 Issue No. 480 
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Published in Cairo by AL-AHRAM established in 1875 |
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Al-Ahram Weekly 4 - 10 May 2000 Issue No. 480
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| Published in Cairo by AL-AHRAM established in 1875 |
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Egypt Region International Economy Opinion Culture Special Features Travel Living Sports Profile People Time Out Chronicles Cartoons Letters
Privatisation in reverse
THE GOVERNMENT is yet to make good on its announcement that it will repurchase the shares of the Egypt for Free Shops Company that it sold to the public two years ago.Last week, it was announced that Prime Minister Atef Ebeid had approved a memo presented by Public Enterprise Minister Mohktar Khatab concerning a settlement with the shareholders of the company which owns all duty-free shops in Egypt. However, Abdel-Salam El-Zedi, chairman of Egypt for Free Shops Company, said the company had not received any official communication in this regard.
Company shareholders have been disgruntled due to the company's poor performance following the promulgation in June 1999 of two decrees that regulate duty-free shops in Egypt. After the decrees were implemented, share prices fell from LE40 to LE9, leading shareholders, of whom 25 per cent are foreigners, to demand that the government repurchase their shares.
Under the terms of the settlement approved by Ebeid, the state is to repurchase the company's shares at LE33 -- a figure that represents their price the day before the first of the two decrees was issued plus an additional LE3 compensation per share.
According to El-Zedi, the LE33 share price is unfair because shareholders, in accordance with the agreement they made to purchase an interest in the company, did not take any of the company's net profits during the last two years. Representing a total of LE27 million, these profits were instead added to the company's capital and a portion of these profits were added to the pension fund of the company's employees.
In August 1999, Mustafa Eid, chairman of the Holding Company for Housing, Tourism and Cinema representing the state, signed an agreement with the company's chairman that the state would repurchase stock from shareholders who had been harmed by these decrees. The holding company has not moved to implement this agreement and shareholders have threatened to file a suit against the state.
More PCs
GATEWAY Incorporation, a US desktop PC producer, says it will increase its sales in Egypt by 50 per cent this year.Egypt is a fast growing market with a rising demand for PCs, and Gateway is looking to expand that even more by selling its product directly to the consumer through a series of showrooms. The company says it will offer payment by instalments, which is something new in the local market, according to Lenia Iacovides, Gateway's director of sales for South and Eastern Europe, the Middle East and Africa.
Gateway gained its market share through competitive bids made in corporate and government sectors, as well as to small and medium-sized enterprises.
Chemical support
RHODIA Egypt Chemicals, a French company operating in Egypt, announced the opening of its free trade zone operations in Alexandria. The zone is intended to promote sales of Rhodia's products to Egyptian small and medium sized companies that can not import directly from the supplier, according to Pierre Laguerre, vice president of Rhodia for international affairs.Rhodia began operations in Egypt one year ago, producing chemicals used in preserving food, pharmaceuticals, paint and building materials and textiles.
"Egypt has the potential to be an industrial base for our exports to the region," Laguerre said.
Rhodia recently started operating a silicon industrial project in Egypt, where the silicon components are assembled in preparation for manufacturing the silicon.
