The Egyptian government on Tuesday began implementing an Administrative Judicial Court ruling issued in May, which restored the iconic retail chain Omar Effendi to the public sector, annulling a 2006 deal selling the company to a Saudi investor.
The National Company for Construction, representing the government, sent its representatives to reclaim the company's main branch on Tuesday, which is located on Adly Street in downtown Cairo, as well as four other branches.
In 2006, the Omar Effendi department stores were privatized and sold to the Anwal United Trading Company of Saudi Arabia for approximately LE504 million. Yahya Hussein, former board member and champion of the business, had estimated the chain's true value at around LE1 billion. Nonetheless, he was ultimately forced by the Ministry of Investment to sign documents approving the sale without knowing the government had sold it for half its estimated value.
A court ruling annulled the deal based on a lawsuit filed by an engineer named Hamdi al-Fakhrani, in which he said the deal represented the squandering of public funds. The value of just one branch of the department store, he argued, was over US$700 million.
Safwan al-Selmy, vice president of the National Company for Construction told Al-Masry Al-Youm that the company’s representatives on Tuesday headed toward Omar Effendi’s main branch with a number of inventory committees.
Selmy went on to say it would take around 10 days for the inventory committees to finish monitoring the assets of the five branches. He added that the remaining 80 branches are distributed among the various governorates, and inspecting them all would take around 25 days.
According to an announcement made by suppliers and bank creditors, since its privatization in 2006, Omar Effendi’s debts amounted to over LE900 million. However, the court ruling requires the investor to hand over the company clear of debt.
Translated from the Arabic Edition
