Foreign investors have submitted bids for a 30 percent stake in Egypt’s largest tobacco producer, Eastern Co., reports Ahram Online, citing an Aug. 22 statement from the Egyptian stock exchange.
According to news reports, Japan Tobacco International is one of the investors considering the deal.
Eastern’s majority shareholder, the state-owned Chemical Industries Holding Co. (CIHC), is reportedly studying the offers and conducting due diligence.
In addition to CIHC, which has a 50.95 percent stake, Eastern’s current shareholders include the tobacco company’s employees’ union and South Africa’s Allan Grey Equity Fund, which each own 5.2 percent of the company. The remaining 9 percent is traded on the Egyptian exchange.
In the first nine months of fiscal 2022–2023, Eastern reported a net profit of EGP5.29 billion ($171.22 million), up 24 percent over that recorded in the previous financial year.
The potential sale is part of Egypt’s plans to offer stakes in 32 state-owned companies to strategic investors under the country’s commitments to the International Monetary Fund, which has offered a $3 billion loan.
The nation is struggling with a $17 billion financial imbalance through 2026 and a local shortage of U.S. dollars.
To date, the state assets sale program has generated around $2 billion.