EGX 30 0.43% Down, Hermes Dives On EFSA Announcement; Thursday Opening
During Thursday opening session, the Egyptian Exchange (EGX) has posted early losses of EGP 1.6 billion as the capital market has amounted to EGP 331.645 billion; according to data compiled by Amwal Al Ghad at 09:04 GMT (11:04 a.m. in Cairo).
Egyptian President Mohamed Morsi asked Tuesday Hisham Kandil, the minister of water resources and irrigation little known outside Egypt, to form a new government, state media reported on Tuesday.
Kandil was a senior bureaucrat in the ministry until he was appointed minister in July last year in the wake of the overthrow of President Hosni Mubarak.
The main index, EGX30 dived 0.43% to hit 4724.97 p. EGX20 sank 0.71% to reach 5404.2 p.
Meanwhile, the mid- and small-cap index, the EGX70 edged down 0.26% to hit 423.15 p. Price index EGX100 inched lower 0.20% to reach 724.17 p.
Traded volume reached 2.157 million securities worth EGP 19.307 million, exchanged through 497 transactions.
This was after trading in 49 listed securities; 27 declined 9 advanced while 13 keeping their previous levels.
Egyptians and Arabs were net sellers seizing 96.8% and 0.96% respectively, of the total markets, with a net equity of EGP 402.723 and EGP 126.211 excluding the deals.
On the other hand, the non-Arab Foreigners were net buyers seizing 2.24% of the total markets, with a net equity of EGP 528.934 excluding the deals.
Leading Shares:
EGX’s leading shares witnessed collective downwards except for the shares of Talaat Moustafa Group (TMGH.CA) and of Orascom Construction Industries (OCIC.CA) which went up by 0.51% and 0.32% respectively to hit EGP 3.98 and EGP 249.00.
Orascom Telecom Media & Technology Holding:
The shares of Orascom Telecom Media & Technology Holding (OTMT.CA) led EGX’s downwards to sink by 8.16% to hit EGP 0.45. .
EFG-Hermes Holding:
The shares of EFG-Hermes Holding (HRHO.CA) edged down 0.92% to reach EGP 10.80 amid the Egyptian Financial Supervisory Authority (EFSA)’s announcement regarding halting Hermes’ joint venture deal with QInvest.
Egypt’s financial regulator has suspended a joint venture deal between Egyptian investment bank EFG-Hermes (HRHO.CA) and Qatar’s QInvest, approved by shareholders on June 2, the state news agency said on Wednesday.
“The Authority approved the assembly in form but refused it in terms of content, procedures and decisions,” the Chairman of the Egyptian Financial Supervisory Authority (EFSA) Dr. Ashraf Al-Sharkawy was quoted as saying to the state news agency MENA.
EFSA rejected decisions made at EFG-Hermes’ annual meeting last month because the firm did not clarify various points regarding the deal including the fate of minority rights after it is completed, MENA cited Al-Sharkawy as saying.
EFG must provide the required information and re-convene the shareholder meeting so that procedures for the deal can be completed, MENA cited Al-Sharkawy as saying.
A number of capital market experts has asserted that EFSA’s announcement does not mean that the Hermes-QInvest deal was rejected but EFSA needs more clarification about various points regarding the deal including the minority rights after it is completed.
Accordingly, experts noted that once EFG-Hermes provides EFSA with further clarification on its deal with QInvest including the minority rights, the procedures for the deal will be completed.
“EFSA’s request for reconvening Hermes Shareholders’ meeting does not mean that the deal is being rejected as EFSA seeks further clarification on the minority’s rights in case of sealing this deal.” Wael El Nahas, a financial analyst with HA Securities told Amwal Al Ghad
Orascom Telecom Holding:
The shares of Orascom Telecom Holding (OTH) (ORTE.CA) inched lower 0.63% to hit EGP 3.18.
Citadel Capital:
Shares of Citadel Capital retreated 0.34% to reach EGP 2.90.
Pharos Research commented on the news that Citadel Capital (CCAP.CA) entered into a termination agreement with Golden Crescent Investments, an Opportunity-Specific Fund controlled by the firm, to end the previously announced sale of the National Petroleum Company (NPC) to Sea Dragon Energy due to the uncertainty regarding the date of sale as well as ongoing economic turbulence locally and internationally.
Pharos’ Hamza Al-Assad described the termination of the sale agreement as cash-negative as well as strategically-negative in as much as it continues to undermine CCAP efforts to exit from non-core investments and increase its stakes in core investments.
“In March 2011, CCAP had agreed with Sea Dragon to purchase NPC for a total consideration of $147.5 million, split into $87.5 million in the form of Sea Dragon shares and $60.0 million in cash. It is interesting to note that the deadline for Sea Dragon to finalize the sale was set at 10 August 2012”, he added.
Commercial International Bank:
The shares of Commercial International Bank- Egypt (CIB) (COMI.CA) tumbled by 0.33% to hit EGP 27.40.
