Beni Suef power station to be sold to foreign investor

Egypt - The government is planning to sell 70% of the Siemens power station in Beni Suef, which has a capacity of 4.8 gigawatts, to a foreign investor, as part of its efforts to obtain dollar flows amid a currency crisis.

According to informed sources, the final buyer of the station will have to pay off the loans of international creditors, which amount to nearly $2.25bn. The loans were part of a larger financing that the government obtained from European banks in 2016 to build three stations with a total capacity of 14.4 gigawatts.

The sources told Daily News Egypt that the repayment process will transform the loan from long-term development financing to commercial financing. The total loans owed by the three stations are estimated to be $7bn, while the total value of the stations is about $10bn.

The sources added that two companies, British Actis and Malaysian Edra Power Holding, are competing for the Beni Suef station in separate bids, after they were in an alliance earlier. The government expects to receive about $1bn from the sale of the station, after paying off the lenders’ debts.

Actis had submitted a letter of intent in 2019 to acquire more than 51% of one of the three Siemens power stations, which were implemented in cooperation with Orascom Construction and Elsewedy Electric.

The sources said that potential investors will start the procedures after obtaining the approval of creditors, following the approval of HSBC, which the government appointed as a consultant to negotiate with the German lenders.

The government is currently working to restructure the station with the aim of offering a share of it to strategic investors, or possibly on EGX. The Sovereign Fund of Egypt will be in charge of the process of offering the station.