Egypt seeks buyers for army-owned gas station chain

The Defense Ministry has chosen the sovereign wealth fund to sell part of its portfolio of companies in what will be the first such offering in the country to military-owned companies.

Wataniya, which controls around 200 gas stations, and the Safi Mineral Water Bottling Company, will be the first company owned by the Army’s National Service Projects Organization to go on sale.

Soliman said the Egyptian sovereign wealth fund was helping to sell between 80% and 90% of the National Petroleum Company of the National Organization of service projects, provided it retains a stake between 10% and 20%. The buyer may maintain the gas stations on the basis of a long-term lease.

“While we were doing the process, we found out that there are different models, like in Europe, from what we understand. The service stations are no longer owned by the same companies or the same distribution companies,” he added.

“They only give the agency the right to the brand. There are now specialist operators who publish their balance sheets in order to acquire the terminal, which widens the range of potential investors,” he said, adding that any brand could be granted an agency right under a contractual agreement.

Suleiman hopes to complete the sale by the end of June.

NSPO has authorized the sovereign wealth fund to invest in a number of businesses and assets and to engage other partners.

“They were offering a number of assets,” Soliman said. “Therefore, we have chosen companies that we believe can be marketed and companies in attractive industries.”

“Our mandate is to act as a catalyst for foreign direct investment for the participation of the private sector,” he told Reuters.

The fund has identified three other companies belonging to the National Service Projects Authority that are expected to be sold, but have not yet disclosed their names. All three companies operate in the food, non-food FMCG and petrochemical sectors.

Suleiman said a national company is one of two gas station chains owned by the National Service Projects Authority. The other company is Chillout, which is separately owned by the device through its branch, the National Society for Road Construction and Development.