RIYADH: International companies are determining the value of Egypt’s state-owned hotels before the government sells stakes in these properties to strategic investors, according to the country’s public enterprise sector minister.
The sale of state assets gained new urgency after the war in Ukraine triggered heavy foreign investment outflows from Egyptian financial markets.
“A private company was established, with the holding companies of the tourism and hotels sector, along with the Egyptian General Company for Tourism and Hotels, having a large share in it. This move aims to transfer the government hotels to the newly established company,” Mahmoud Esmat said in an interview with Asharq.
He added: “The Sovereign Fund of Egypt is working on marketing the government hotels. It has also offered 20 percent of these assets to strategic investors, along with stakes in the stock market.”
Esmat said that the new company was established with a capital of 10 million Egyptian pounds ($326,700), explaining that “the capital will increase once the government hotels assessment process is done and the fair value is determined.”
According to a report in Zawya, the state-run hotels that are up for sale are Cairo Marriott Hotel, Sofitel Legend Old Cataract in Aswan, Marriott Mena House, Sofitel Winter Palace Luxor, Steigenberger Cecil Alexandria, Mövenpick Aswan, and “Elephantine” Aswan.
This is a new step that confirms what Prime Minister Mostafa Madbouly announced in June 2022 that “a number of hotels will be merged in preparation to be listed on the stock exchange, in order to expand the governance of government institutions.”
The sale of these hotels forms part of Egypt’s effort to enhance the participation of the private sector to accelerate the pace of economic growth and attract foreign investments at a time when the country is suffering from a lack of hard currency.