Talaat Moustafa Group Holding fell the most in almost three weeks after a panel of judges issued a recommendation that may strip Egypt’s largest publicly traded real estate developer of its biggest land asset.
The shares slid 7 percent, the most since June 19, to 4.4 Egyptian pounds at the 2:30 p.m. close in Cairo. The decline trimmed the advance this year to 49 percent. The benchmark EGX 30 Index retreated 1 percent.
An Egyptian panel of judges recommended the annulment of a revised contract that allowed the government to sell a plot of land to Talaat Moustafa for its Madinaty project, an opinion the company said wasn’t binding. A court session on Nov. 4 will be held to examine appeals against a ruling by Egypt’s Administrative Court that the sale was legal, Talaat Moustafa said in a statement.
“It’s unclear why this case is still being handled by the courts,” said Rehab Taha, Cairo-based equities analyst at Prime Securities SAE, who has a buy recommendation on the shares. “All indications were that it was over with the last ruling that reaffirmed that the contract was legal. The stock should continue to be pressured until the November hearing.”
The November 2011 ruling had allowed the company to keep the 33-million-square-meter plot on the outskirts of Cairo that it’s using for a residential and business development. The original sale contract was ruled illegal in June 2010 before being revised by the last government of former president Hosni Mubarak by invoking a “national interest” clause of the law.
Amendments to the contract are “almost impossible” as it has already been implemented, Talaat Moustafa said in its statement today.