CAIRO, 2 July 2005 — The petrochemical giant Saudi Basic Industries Corp. (SABIC) said it dropped its plan to bid for shares in the Egyptian Fertilizers Company after it was unable to match the other counter-offers.
The highest offer made for the shares was by a consortium of Egyptian and Gulf Arab investors that priced one share of the company at $501, outbidding a $500 a share offer from a group led by Egypt Kuwait Holding Company. The Egyptian and Gulf Arab consortium, which comprises National Fertilizers Company, Citadel Capital Company and Financial Arab Investment Company, said the offer was for 1.475 million shares, or 100 percent, of the firm. India’s Tata Chemicals Ltd. recently withdrew its bid after it was unable to match EKH’s counter-offer, but SABIC has yet to announce how much it is willing to put up for the sizeable company.
Egyptian Fertilizers, which is 46 percent owned by the government, produces 400,000 tons of ammonia fertilizer and 635,000 tons of urea fertilizer a year. The company achieves annual surplus of $62 million, as well as it represents a successful investment opportunity as it will achieve an annual income of $120 million to the national economy.
SABIC, which was expected before to win the bid, said in a statement that it withdrew from the deal since the recent offers were too high for the company. “Buying Egyptian Fertilizers Company at the prices currently offered would not bring about the return on investment which SABIC strives for,” SABIC said adding it will still seek to boost their investment in the Egyptian market.
