Egyptian officials have engaged in discussions with German banks regarding the potential sale of shares in the Siemens power stations in the country.
Approval from the banks is required due to financing contracts that prohibit the disposal of the stations without their consent or the repayment of loans.
These conversations took place following a meeting between Prime Minister Mustafa Madbouly and Egyptian officials to discuss the steps involved in offering the Siemens power station in Beni Suef to investors, reported Asharq Business reported, citing three officials.
In 2018, Egypt inaugurated three large power stations in collaboration with Siemens, Orascom Construction, and El Sewedy Electric.
These stations, located in the New Administrative Capital, Burullus, and Beni Suef, have a combined capacity of 14.4 gigawatts.
The project cost approximately 6 billion euros, with financing of around 4.1 billion euros obtained from German Reconstruction Banks, Deutsche Bank, and HSBC.
An official revealed that the Egyptian Electricity Holding Company has been making regular loan repayments since 2019.
However, according to the financing contracts, the stations cannot be disposed of without the banks’ approval or the full repayment of the loans.
Notable companies such as Saudi’s ACWA Power and the UAE’s Alcazar have expressed interest in purchasing Egypt’s wind farms in Jabal Al-Zeit and Zaafarana.
Siemens’ power plants currently operate at a capacity of 12.2 GW, accounting for about 85% of Egypt’s total electricity production.
Egypt initially announced plans to sell one of the power plants four years ago, attracting the interest of international investors like the Blackstone Group and Actis.
To facilitate the sale process, additional steps are required, including the separation of the three Siemens projects and the establishment of three companies to manage them.
The first company, “Bani Suef for Electricity Production,” has been established with its board of directors in place, but the transfer of assets to the new company is still pending.
Selling shares of the power plants to strategic investors could help Egypt alleviate debt burdens, attract foreign currency, and stimulate investment. However, the process may take time.
The power stations in the Administrative Capital, Burullus, and Beni Suef contribute to 27% of Egypt’s total electricity generation and are expected to cover their own costs by 2025 through fuel savings.
