FRA Amends Listing Rules in preparations for Receiving Major Companies’ Offerings in EGX

As of 16th September 2021, the Board of Directors of the Financial Regulatory Authority (“FRA”) had approved to amend some provisions of listing rules and delisting securities in the Egyptian Stock Exchange (“EGX”) in preparations for receiving major offerings for number of projects with massive liquidity and enormous assets expected to be seen in the Egyptian Stock Exchange (“EGX”) during the coming period.

“The rules of listing in the (“EGX”) have set a minimum percentage of the shares that is going to be offered and the percentage of free-traded shares, and in the case of applying these two standards on major companies whose capitals may exceed tens or hundreds of billions, in this case it will require huge financial values for offering in a way that may hinder or lead to its reluctance to move forward, towards the listing process and thus, offer its shares for trading.” Said Dr. Muhammad Omran,

Chairman of the Financial Supervisory Authority.

He added: the FRA Board of Directors had taken the initiative to facilitate the listing for companies and entities with enormous assets to encourage them to list their shares in a way that contributes to enhancing and revitalizing the liquidity rates in the (“EGX”), as the FRA made an amendment to some provisions of the Listing Rules and delisting securities on the (“EGX”) by creating 1% of market capital value freely-traded, as a new alternative to the value of the offered shares, meeting the minimum number of shares to be offered.

Moreover, other criteria were created to the value of free-traded shares at 0.5% of the value of the free-traded market capital, meeting the minimum number of free-traded shares in those companies, without addressing specific percentages of the company's shares if those standards are met to suit the enormous capital that big companies enjoy.

“The Egyptian state had announced - in the middle of last month - its plan to offer the New Administrative Capital Company on the EGX during the next two years, in measurements that will help doubling the value of market capital, contributes to attracting new investors, and creates a state of great recovery in the Egyptian Stock Exchange, which is reflected positively. on the Egyptian economy.

For further information or to discuss the new FRA amendments in Listing Rules in more detail, please contact: Muhammed Abu Daif m.abudaif@tcmglaw.com or Omar Abu Daif o.abudaif@tcmglaw.com