Egypt’s al-Arabiya al-Wataniya for Cement has found another investor to take a stake as it seeks capital to build a cement plant in the south of Egypt.
Egypt’s Misr Cement Qena said in a statement to the stock exchange on Monday it had agreed in principle to take a 10 per cent stake in the new cement company.
Misr Cement Qena was waiting for completion of legal procedures for al-Arabiya’s capital to be increased before finalising the transaction, it said.
"The board has agreed to take a US$15m stake in the company, or 10 percent," the statement said.
Al-Arabiya, which will have capital of US$155m, received one of six cement licences awarded by Egypt in October 2007 to boost production after domestic prices increased.
The government threatened late last year to take the licence away unless the company secured finance and sped up construction of its planned 1.6Mta grey cement plant in the province of Minya.
The plant will cost an estimated US$324m, with 48 per cent financed by capital and 52 per cent by bank loans.
ASEC Cement, a subsidiary of Egyptian private equity firm Citadel Capital , has stakes in both al-Arabiya and Misr Cement Qena, and had asked Misr Cement to join the venture.