Briefs

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Coming to terms

THE ORASCOM Telecom (OT) and France Telecom (FT) dispute over their joint holding of Mobinil may soon end. This week Egypt's benchmark stock index EGX30 gained 2.17 per cent on Monday supported by local and foreign investors' buying of telecom shares, particularly Orascom Telecom (OT). Reuters reported Monday that investors "bought telecom firms on talk that a row between shareholders in Mobinil could be resolved soon".

Meanwhile, a Tuesday release from the Capital Market Authority (CMA) stated that "an obligatory tender offer was submitted, according to Article 12 of the Executive Regulations of Law 95/1992, from Orange Participations (bidder) to purchase the whole shares of the Egyptian Company for Mobile Services," and that the CMA is currently studying the offer. Orange Participations is a unit of France Telecom.

The dispute between the two companies peaked mid-April when OT insisted that according to the Egyptian capital market law, FT needed to make a tender offer to all shareholders of Egyptian Company for Mobile Services (ECMS). But FT insisted that it is not obliged to make a tender offer to all ECMS shareholders and that the ruling of the International Court of Arbitration of the International Chamber of Commerce requires it to buy only OT shares in Mobinil, which owns 51 per cent of ECMS.

Up and running

THE EGYPTIAN Stock Exchange (ESE) seems to be getting back in shape. ESE Chairman Maged Shawqi has been quoted as saying that the size of trading in the market is almost back to the end of 2008 levels, reaching an average of 80,000 operations per day at a value of around LE1.7 billion.

Bloomberg reported that ESE aims to start a derivatives market in the second half of 2010 as well as short sales in the market "as soon as possible", quoting Shawqi in interview with Bloomberg Television. "The decision on the timing is ultimately up to the country's financial regulator," he said.

According to Bloomberg, Egypt's benchmark EGX30 Index has risen 25 per cent this year. The index lost 56 per cent in 2008 due to the global financial crisis.

Down again

FOR THE THIRD time this year the Central Bank of Egypt (CBE) decided to cut its overnight deposit rate by 50 basis points (bps) to 9.5 per cent per annum and its overnight lending rate by 100 bps to 11 per cent per annum. The discount rate was also cut by 50 bps to 9.5 per cent per annum.

A press release issued by the CBE's Monetary Policy Committee (MPC) following its meeting last Thursday said "annual headline CPI inflation continued to decline in April 2009, reaching 11.7 per cent down from 13.5 per cent and 12.1 per cent in February and March, respectively. This records a cumulative drop of 11.9 percentage points since its peak in August 2008. The downward trend in headline inflation comes on the back of the decline in domestic food inflation, which fell from 31 per cent year-on-year (y/y) in August 2008 to 13.7 per cent y/y in April 2009."

Nonetheless, the CBE said that, "the sharp retrenchment in international commodity prices, which had begun in the second half of 2008, has not been fully reflected in domestic price levels due to the downward price rigidities in domestic markets."

The CBE projected that annual inflation will fall towards its comfort zone by mid-2009.

The MPC also said it will "continue to take the necessary measures to contain the adverse effects of the global economic turmoil on the domestic economy, provided that they do not conflict with the price stability objective."

Hackers busted

YOUNG Egyptian innovators are regionally recognised for their contributions in the field of information technology (IT). Last week, the Cairo-based ValueSys, a provider of proprietary software solutions and a technical support consultancy, was recognised as the region's most active commercial promoter in its combination of promotions for Kaspersky Lab, a leading international Internet security and anti-virus specialist.

"Egypt is the most important and most promising North African market for Kaspersky Lab due to its size, growing Internet penetration and vast potential," said Garry Kondakov, managing director of Kaspersky Lab. ValueSys was handed the award during the annual Middle East and Africa Partners Conference, recently held in Dubai.

Kaspersky Lab delivers world-class protection against IT security threats, including viruses, spyware, crimeware, hackers and spam.

Untapped gas

THE DENSELY populated area of the Nile Delta is disclosing more of its natural resource abundance. A gas-bearing reservoir has recently been explored and drilled by RWE Dea within the Desouq concession, an onshore area of 5,375 square kilometres within the Nile Delta. The new discovery, Sidi Salem, is the eighth well to be drilled in the Disouq concession. The well lies 11.5 kilometres southwest of another well that was successfully drilled by the same company at the beginning of the year. Another exploration well will soon be drilled in the same concession area.

RWE Dea, headquartered in Hamburg, is an international company operating in the field of gas and oil exploration and production. In Egypt, the company has been operating in the upstream segment in the Gulf of Suez since 1974. In recent years, the company made several major gas discoveries and boosted its activities through the acquisition of additional concessions. At present, the company has 15 onshore and offshore concessions in Egypt that spread across an area of about 15,500 square kilometres.