Egypt’s Palm Hills to Increase Capital

Egyptian property developer Palm Hills (PHDC.CA) said on Monday it received approval from the regulator to raise 600 million Egyptian pounds ($85.9 million) in a rights issue to help it finance its building programme.

The firm has been battered since the uprising that toppled Hosni Mubarak last year by investigations into previous state land sales and by client cancellations. New sales have declined.

Palm Hills, which has 1.05 billion shares outstanding, will sell 300 million new shares, increasing its capital to 2.70 billion pounds.

“The money will be mainly allocated to finance project construction,” a company spokeswoman Ibtessam Zayed said.

The company will begin the rights issue, which was approved by the Egyptian Financial Supervisory Authority, after it is submitted to a shareholders meeting “that will take place very soon,” she said.

Palm Hills’ share price fell by 3.5 percent on Monday to 2.21 pounds.

Source: Reuters