Orascom Construction eyes dual listing in Egypt and Dubai stock exchange

Orascom Construction will pursue a dual listing in Egyptian Exchange (EGX) and Dubai Nasdaq and aims start trading in March this year.

Orascom Construction Ltd announced on Monday that its construction business will be dually listed as a separate entity on Nasdaq Dubai and the Egyptian Exchange (EGX) early March this year.

The listing followed a demerger of the Netherlands-based OCI NV’s engineering and construction business from its fertilizer and chemicals business.

The demerger is expected to take place on March 7, 2015 through a $1.4 billion reduction in OCI NV’s share capital whereby its shareholders will receive one Orascom Construction share for every two OCI NV shares they own as at close of trading on March 6, 2015.

Egyptian law requires that Orascom construction offers new ordinary shares which amounts to 15% of the shares to public retail investor, and through a private placement to qualified institutional investors.

Orascom construction was delisted from the Egyptian stock exchange in 2013 a move which decreased the liquidity in the stock exchange.

The demerger will help OCI to come back into the Egyptian stock exchange after it had moved to Netherlands and this could improve the economy which was hit by currency crisis that prevented foreign investors from investing.

OCI NV will continue to be listed on the Euronext Amsterdam as a global producer of nitrogen fertilizers, methanol and other natural gas based chemical products.

EFG Hermes is acting as sponsor for Orascom Construction’s listing and trading on Nasdaq Dubai, while Bank of America Merrill Lynch, Barclays and HSBC Bank Middle East Limited are acting as joint financial advisors.

Trading on the exchange is slated to start on March 9.

For the EGX listing, EFG Hermes is acting as global coordinator and joint bookrunner, while CI Capital and HSBC Bank Middle East Limited are joint bookrunners. Rabobank is acting as the Dutch financial advisor.

The shares will be listed and traded on Nasdaq Dubai in US dollars, and in Egyptian pounds on the EGX.

As a newly formed holding company with no current or historical operations, Orascom Construction will focus on investments in infrastructure concessions, the company said.

It currently operates under three business units, including Cairo-based Orascom; US-based Contrack, which undertakes engineering, procurement and construction services; and Iowa-based The Weitz Company, a general contractor, design-builder and construction manager.

The company also has a 50 per cent shareholding in Brussels-based BESIX Group, which carries out commercial, industrial and infrastructure projects in 19 countries throughout Europe, the Middle East and northern and central Africa.

Osama Bishai, who served as OCI NV’s head of engineering and construction arm, will serve as Orascom Construction’s CEO. Mark Littel, who joined the group last year, will serve as CFO.

Nassef Sawiris will serve as the non-executive chairman of the seven-member board, which will also include Arif Naqvi and Salman Butt as non-executive directors.

“The board of directors of OCI NV believes that a successful demerger, and dual listing will help Orascom Construction maintain its international profile, continue to provide access to the international capital markets to better position the company for future growth, and enable the company to continue to capitalise on its position as a leading global and regional contractor to pursue the Middle East and North Africa’s resurging construction markets,” the company concluded.