Egypts' Sidi Krir's IPO oversubscribed

08-Aug-05

The petroleum and petrochemical sectors in Egypt will continue to prove attractive to foreign investors. This was apparent in the overwhelming response to the IPO of Sidi Krir. New investment in the oil sector has outpaced other key areas of the economy, with foreign direct investment in the oil, gas and petrochemicals industries surpassing US$9.5 billion, expected to rise to US$16 billion over the next five years. Egypt's oil and petrochemical exports peaked last year at US$5.5 billion and is expected to climb to more than US$10 billion by 2010. Established in 1997 and operational since 2000, Sidi Krir Petrochemicals is Egypt's largest producer of ethylene and polyethylene, previously 97% state-owned. Banque Misr and the Egyptian General Petroleum Corporation (EGPC) were the leading shareholders, with a 20% stake each. Banque du Caire, the National Bank of Egypt (NBE) and Bank of Alexandria each held 10% stakes in the company. The company recently offered 20% of the State's holding as IPO, cutting the state's shareholding of Sidi Krir to 77%. The 20% offering was contributed largely by Misr Insurance, the Bank of Alexandria, Banque du Caire, the National Bank of Egypt and Banque Misr. SIDPEC's IPO was the first of three sales expected in the petroleum and petrochemicals sectors. Alexandria Mineral Oils Company (AMOC) and Middle East Oil Refinery (MIDOR) will soon follow suit.