Dana Gas PJSC, the energy producer that restructured debt last year due to delayed payments, rose the most in eight years after it received $53 million from Egypt, stoking bets of better cashflow.
The stock surged almost 15 percent, the most since December 2005, to 86 fils at the close in Abu Dhabi. More than 311 million shares were traded, almost nine times the three-month average daily volume. Egypt has paid Dana $130 million this year of $330 million owed to the Sharjah, United Arab Emirates-based company, it said in a statement to the Abu Dhabi bourse yesterday. The company said it is working with Egyptian authorities to expedite repayment.
Egypt delayed payments for energy supplies after the 2011 popular uprising slowed economic growth and as local gas output declined, putting pressure on the government’s price-cap policy. Dana restructured about $1 billion of Islamic bonds last year because of remittance holdups caused by political unrest in Egypt and Iraq.
“This may be the beginning of resolving the company’s cashflow problems,” Montasser Khelifi, Dubai-based senior manager for global markets at Quantum Investment Bank Ltd., said by phone. “It helps the company live up to its own debt obligations and gives more security to investors because there’s real engagement by the Egyptian government.”
Dana’s shares have advanced 91 percent this year, compared with a 59 percent gain in the benchmark gauge. Five analysts recommend buying the stock, while one advises holding and another selling, according to data compiled by Bloomberg.
Dana was the biggest gainer on the ADX General Index today, which climbed 0.6 percent.