The National Bank of Egypt (NBE) is close to a debt settlement deal with the Arab Company for Special Steel (Arco Steel) which owes the bank EGP 1.6 billion.
Sources told Amwal Al Ghad that NBE has agreed with the banks and the companies which own Arco Steel over settling its debt in exchange for real estate and in-kind assets as well as a paying a debt settlement prepayment.
Sources expected the final settlement contract to be signed before the end of 2012. The bank owns 7% of the company’s capital, a commercial mortgage on the company’s assets and a commercial mortgage on the company’s properties which cover the value of the loan.
The authorized capital of Arco Steel is EGP 800 million and the issued and paid-up capital is EGP 346.1 million divided on 1.7 million shares with par value of EGP 200 per share.
The ownership structure of the Arco Steel is divided as follows: National Investment Bank (19%), Misr Insurance Company (13%), Al-Shark Insurance Company (10%), Metallurgical Industries Holding Co. (9%), Egyptian General Petroleum Corporation (8%), National Bank of Egypt (7%), Egyptian Reinsurance Company (7%), Suez Canal Authority (6.5%), Industrial Development and Workers Bank of Egypt (5%) and Arab Investment Company owned by governments of 17 Arab states (7%).
The Arco Steel was offered for sale in 2007 but the Saudi Al-Tuwairqi Group decided to retreat from submitting its bid to compete with Ezz Steel over acquiring 80% of the Company. This made Arco Steel cancelled the sale.
NBE reduced its non-performing loans by EGP 17 billion during four years as they reached EGP 6 billion at the end of June 2012, down from EGP 23 billion at the end of June 2008.
