Egypt’s Palm Hills plans $230 mln share issue to raise capital

Palm Hills, Egypt's second-largest listed real estate developer, plans to issue new shares worth 1.65 billion Egyptian pounds ($230.49 million) to raise its capital and fund growth.

The company said in a statement on the Cairo bourse website that it had called a shareholder meeting on Jan. 12 to approve the plan, which aims to increase its capital from around 2.7 billion to about 4.35 billion pounds.

Palm Hills plans to issue 824 million shares at a nominal value of 2 pounds each, it said.

Palm Hills co-chief executive told Reuters in December, the company would begin investing in commercial properties in 2015 and expand its residential operations to meet higher demand as the economy begins to recover from four years of turmoil.

Palm Hills faced client cancellations and investigations into previous state land sales following a popular uprising in 2011 that toppled Hosni Mubarak but ushered in a period of political upheaval that spooked investors.

A flight by foreign companies from violent unrest following the overthrow of elected President Mohamed Mursi in mid-2013 threatened to drive up vacancy rates at offices and malls and prompt international investors to shift funds to other markets.

Helped by billions of dollars in Gulf aid, Egypt's economy is showing signs of recovery, boosting property demand.

Palm Hills reported a 152-percent jump in third-quarter net profit, driven by a sales after it delivered more properties to market, including a billion pounds worth of sales in vacation homes on the north coast.

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