The European Bank for Reconstruction and Development (EBRD) has approved a $25m two-year working capital loan to support Orascom Construction’s operations in Egypt.
The EBRD said that the loan aims to support Orascom Construction’s working capital requirements amidst the crisis caused by the novel coronavirus (COVID-19) pandemic. The Egyptian company is expecting higher working capital needs as result of the pandemic.
During the first quarter (Q1) of 2020, Orascom Construction experienced the effects of the partial lockdown due to the pandemic. These have been further aggravated by the social distancing measures, as well as the required health and safety requirements, on the project sites.
A two-year US dollar working capital facility will improve Orascom Construction’s financial resilience to withstand the potential negative implications of the pandemic.
The loan, which is not associated with capex and is not tied to a specific project, will also ensure the company has sufficient working capital and liquidity. The environmental and social (E&S) risks associated with the loan relate to ongoing company activities.
The Orascom Construction Company is an Egyptian joint stock company. The engineering and contracting company is one of the leading Egyptian companies realising infrastructure, industrial and commercial projects.
The company is fully owned by Orascom Construction PLC, a global engineering and construction contractor focused on infrastructure, industrial and commercial projects in the Middle East, North Africa, Europe and the United States.
Orascom Construction PLC is listed on the Egyptian Exchange (EGX) and NASDAQ Dubai, with a market capitalisation of $550m and a diversified shareholder base split between Egyptian and international investors.