Orascom Development Abandons $140 Million Share Sale on `Irregular' Trades
Orascom Development Holding AG, a resort company run by billionaire Samih Sawiris, called off its planned share sale that could have raised about 150.2 million Swiss francs ($140 million), after observing “irregular trading activities” in its stock.
Orascom Development saw “irregular trading activities involving unusually high volume coupled with a steep decline in share price,” in Swiss Trading yesterday, it said in a statement. In light of the “abnormal” trading, it said it notified SIX Swiss Exchange and called off the planned share- capital increase.
The company had planned to raise capital using a private placement of about 2.3 million shares by way of an accelerated bookbuild today. The capital increase was supported by the majority shareholder, Samih Sawiris, who backed the offering by committing up to 85 million Swiss francs, Orascom Development said.
Orascom Development fell 7.25 francs, or 10 percent, to 64.75 francs in Swiss trading yesterday.
The company plans to spend 5 billion Egyptian pounds ($902 million) on building low-cost homes in the Middle East and Europe, targeting Romania, Turkey and Iraq, to generate steadier earnings growth, Sawiris said in a March 8 interview at his office in Cairo.
First-quarter revenue is in line with the company’s strategy and current expectations, and management believes it to be on course with analysts’ full-year expectations for 2010, the company said in the statement.
Sawiris is part of the Sawiris family, whose other companies -- Orascom Construction Industries and Orascom Telecom Holding SAE -- account for more than two-thirds of the market value of Egypt’s EGX 30 Index.
Orascom Telecom, the Middle East’s biggest publicly traded mobile-phone company, said it will release “material news” today amid speculation it will sell parts of the business to Africa’s MTN Group Ltd.
The Cairo-based company didn’t provide further details in a statement sent to the Egyptian Exchange yesterday and trading of Orascom Telecom’s shares in Egypt and London were suspended pending an announcement.