Jordan Times
Saturday, April 25, 1998
Government appoints Arab firm to manage sale of its
equity in JCFC
By Tareq Ayyoub
AMMAN — The government on Thursday signed an agreement with
an Egyptian firm to manage the sale of 33 per cent of government
equity in the Jordan Cement Factories Company (JCFC).
Minister of Finance Suleiman Hafez said that the agreement with
Egypt Financing Group-Hermes (EFG) enables the Cairo-based firm
to work as a financial advisor on the process of selling most of
the government’s shares in the JCFC, which amounts to 49.5
per cent of the company’s capital.
Mr. Hafez told the Jordan Times that he expects that the sale of
33 per cent of equity to be accomplished between eight months to
one year.
“The process might include the sale of the equity to a
strategic partner, the issuance of Global Depository Receipt
(GDR) or public offering in the international market. All options
are open,” Mr. Hafez said.
The minister stressed that the Egyptian firm will prepare a
report on JCFC’s standing to help foreign firms who are
interested get acquainted with the company.
“It will prepare a comprehensive report on the JCFC which
will include the achievements of the company, its future plans,
its profits and other necessary information with utmost
transparency and clarity,” Mr. Hafez said.
The government’s step is part of a privatisation process it
launched in 1996 in line with the Kingdom’s economic
restructuring programme.
The process stipulates the sale of government equities in public
firms such as the Jordan Telecommunication Company (JTC), Royal
Jordanian and the JCFC.
The JCFC’s 1997 financial report revealed that the company
has recorded a net profit of JD11.9 million, a JD633,770 increase
in profits over 1996.
Mr. Hafez said that the sale of the government’s equity in
the JCFC will enable the profit-making firm to attract foreign
investors.
He added that the government will chose “the best offer that
meets its requirements and the party that will pay the highest
price,” regardless of whether such party is local or
foreign.
However, the government’s plan to sell its equity in JCFC
drew disapproval from senior officials in the company who urged
it to refrain from selling to foreign investors.
They also sent memorandums to Prime Minister Abdul Salam Majali
and the Minister of Trade and Industry Hani Mulki urging them to
halt the privatisation of the firm.