Egypt's Eastern Company Board Approves $326 Million Sale Deal

Business by 2FIRSTS.ai

Jul.31.2024

Egypt's Eastern Company Board Approves $326 Million Sale Deal

Egypt's state-owned tobacco manufacturer, Eastern Company, approved the sale of its 9th factory to PMI's subsidiary, UTC, for $32.61 million.

According to Ahram Online on July 29, the board of directors of Egypt's state-owned tobacco manufacturer, Eastern Company (EAST.CA), has approved the sale of the land, buildings, and currently leased equipment of its ninth factory to United Tobacco Company (UTC), a subsidiary of Philip Morris International (PMI), for 1.584 billion Egyptian pounds (326.1 million USD).

The company's statement released to the Egyptian Stock Exchange states that the transaction amount is the average of three valuations provided by a valuation company certified by the Central Bank of Egypt (CBE).

The statement indicates that the contract will be terminated if approval from the Industrial Development Board is not obtained or if any party fails to comply with the terms of the contract, unless otherwise agreed upon by both parties.

Furthermore, the contract approval allows UTC to waive the remaining annual rental value to be paid according to the lease agreement, which will expire on April 26, 2026.

The statement also indicated that approval has been obtained for entering into the swap contract.

It has been reported that PMI announced in May 2024 that it has indirectly acquired a 14.7% minority stake in the company.

References:

[1] Egypt sells Eastern Company’s factory no. 9 for EGP 1.58 bln

Also Read:

[1] Egypt Introduces New Tax Regulations for E-Cigarettes in 2024, Including 14% VAT on Disposables

[2] PMI Acquires Minority Stake in Egypt's Eastern Company

[3] Philip Morris Egypt Adjusts Prices of Tobacco Products

#Traditional tobacco #Market #Africa #Egypt

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