Excitement over Egypt Telecom and Orascom Telecom's IPOs this year has overshadowed the IPO of another communications and IT company: Raya Holdings.
Raya is a holding company for 11 subsidiaries that deal with communications, software development, network building and administration, and training, among other things.
Raya has an impressive client list from the public and private sectors and an equally impressive list of partners - 'allies' include Microsoft, Nortel and Oracle.
Raya began life in 1998: chairman and CEO Medhat Khalil noticed the potential for growth in the Egyptian IT sector, and encouraged six other companies to join his own firm, ProTech, in forming a major technology and communications group.
News of Raya's IPO first emerged in February, when the company wanted to buy additional IT subsidiaries. Egypt's stock market, at the time, was doing tremendously well, the Hermes index having nearly doubled since October.
In April, details of the offering were made public: the offering would be for £E 350 million ($100 million) and would be used to finance further acquisitions and expansion.
But little was heard after that. The offering's manager, EFG-Hermes, revealed in July that the roadshow would take place in mid September, and that it would increase capital by £E 200 million. EFG-Hermes predicted a post-IPO market cap of around £E 1.1 billion (U$310 million).
However, according to one investment banker, the Raya IPO will again be delayed: "The market's down, down and Egypt Telecom's IPO will take attention from Raya. Then there's Ramadan (the Muslim holy month, beginning on November 27 this year). So maybe next year".
Raya already has some powerful partners. In April, it formed an alliance with Nortel Networks, giving it access to the latest telecom technologies. At the same time, the two companies were awarded a major contract by Telecom Egypt, worth £E 120 million ($34.3 million), to install digital telephone equipment in 310,000 homes in Egypt's new cities.
Orascom Telecom owns 50 percent of OraTech, which provides software and services, including Oracle products and training, to businesses such as MobiNil and Click GSM (Egypt's two mobile providers), Egyptian Cement (Egypt's most efficient producer) and Coca-Cola. Orascom Telecom also owns twenty percent of Horizon, which provides expertise in document and data management.
Chairman Medhat Khalil is optimistic about Raya's future.
"The company grew by two hundred percent in 1999," he said in a recent interview with World Investment News. Revenues in 1999 were £E 276 million (US$76.9 million), and profits £E 30.5 million (US$8.7 million). Khalil believes that "we will reach more than £E 580 million this year in revenue and we will exceed £E 60 million ¦in profit¨." Raya will have to see how severely Egypt's recession affects the demand for their widening range of services. – (Albawaba-MEBG)
© 2000 Mena Report (www.menareport.com)
