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GDR ratios not to exceed free-floating shares, MCDR to monitor - Daily News Egypt

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GDR ratios not to exceed free-floating shares, MCDR to monitor

MCDR is closing the door for GDR transfers to Edita, OTMT, GTH, as they exceed the free-floating shares ratio

Misr for Central Clearing, Depository, and Registry (MCDR) will prepare a daily report to monitor the release of Global Depository Receipts (GDR), MCDR managing director Tarek Ezzat Abdelbary said.

The move comes in an attempt to activate the Egyptian Exchange’s (EGX) decision which stipulates that the GDR ratio should not exceed each company’s free-floating shares ratio.

He expects that companies will not find it difficult to follow this decision, as the transfer processes are not solely limited to transferring the shares into certificates of deposit. The processes activate the certificates’ conversion into shares processes, in order to benefit from investing the profits in shares repurchase.

The free-floating share of the Commercial International Bank (CIB) does not exceed the maximum GDR ratio. This ratio is limited to 33% of the total capital so far, despite the active issuance of equity in the last period.

An EGX statement released on Thursday reported that the CIB has 1.9m shares left before reaching the maximum GDR ratio.

All companies have GDRs that match the EGX’s decision, except for three companies, one of which is Edita for Food Industries. The company’s GDR ratio is 24.87% of its capital, which exceeds its free-floating shares ratio at 14.12%.

Additionally, Orascom Telecom Media and Technology Holding (OTMT) GDR ratio is 58.14%, compared to a 40.83% free-floating shares ratio. The third company is Global Telecom Holding (GTH) with a GDR ratio of 73.94%, compared to a free-floating shares ratio of 25.18%.

Ezzat Abdelbary said MCDR will close the door to Edita’s share transfers into GDRs starting 10 August, until the GDR and free-floating shares ratios comply with the EGX’s decision.

GDRs have seen a significant period of financial activity, based mainly on the direction that the EGX’s foreign investors category is taking. Foreign investors can transfer their money abroad through certificates or obtain foreign currency. Moreover, the certificate trading prices are incredibly close to the US dollar exchange rate in Egypt’s informal market.

This table shows companies’ GDR ratios alongside their free-floating shares ratios.

Free-floating shares ratio GDR ratio Company
42.36% 0% Naeem Holding
42.42% 0.14% Pachin
47.07% 1.95% Suez Cement
32.43% 0.83% Ezz Steel
19.61% 0.31% Etisalat Egypt
26.42% 2.22% Ramco for Tourism Villages construction (RTVC)
55.64% 0.76% Palm Hills
48.57% 27.48% Lecico Egypt
54.09% 4.37% GB Auto
76.14% 12.01% EFG-Hermes
14.12% 24.87% Edita Food Industries
66.64% 33.16% CIB
40.83% 58.14% OTMT
25.18% 73.94% GTH




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