Orascom Development Egypt Signs Master Agreement with Egyptian Authorities that Unlocks Additional Value from its El Gouna flagship project.

·5-min read

Orascom Development Holding AG / Key word(s): Miscellaneous/Miscellaneous

15-Feb-2023 / 07:00 CET/CEST
Release of an ad hoc announcement pursuant to Art. 53 LR
The issuer is solely responsible for the content of this announcement.

Ad hoc announcement pursuant to Art. 53 LR.

Press Release 

Orascom Development Egypt Signs Master Agreement with Egyptian Authorities that Unlocks Additional Value from its El Gouna flagship project.

Altdorf, 15 February 2023 – Orascom Development Egypt (ODE), Orascom Development Holding AG's largest Egyptian subsidiary, has announced the signing of a comprehensive milestone master agreement with the Egyptian authorities regarding its flagship project El Gouna which will further ODE’s long-term strategy and efforts to drive growth. The master agreement, which involves various ministries of the Egyptian government, includes the following terms:

  • Approval of a new master plan for the remaining 17.4 million m2 land bank in El Gouna which includes approximately 1.2 million m2 of connected lagoons and 1,000 hotel rooms to be built every 10 years.

  • Granting ODE the right to connect its lagoon system to the sea via two new water canals to improve water quality in existing and future projects.

  • Reducing the shoreline setback for the remaining land bank from 200 meters to 105 meters, which allows ODE to make commercial use of the most prime land of the destination.

  • Amending the transfer fee payable by ODE on real estate sales for the remaining land bank. The transfer fee is fixed for a period of 10 years and shall be paid in advance over 15 years.

  • Granting environmental permits for 24 projects in El Gouna and exonerating ODE from all charges and settlement of all disputes with the Environment Protection Agency.

The amended transfer fee for the entire remaining land bank in El Gouna pursuant to the master agreement is USD 112 million, of which USD 21 million are payable upon signing of the master agreement and the balance is payable in installments over 15 years, with approximately USD 79 million falling due between year 11 and year 15.

In addition, ODE pays USD 39 million upon signing of the master agreement in consideration for the reduction of the shoreline setback, the 24 environmental permits, the approval of the two new water canals connecting the lagoon system to the sea and the settlement of all disputes with the Environment Protection Agency.

Payments will be funded from the following sources;

  • ODE cash and cash equivalents balances which stands at approximately CHF 141 million as of FY 2022;

  • A shareholder loan from the majority shareholder in the amount of USD 30 million;

  • Future cash from operations.

"We are pleased to have reached this important milestone with the Egyptian government." says Naguib S. Sawiris, Chairman of ODH. "The master agreement supports our continuing efforts to deliver value to our customers while enabling us to bring in world-class partners to accelerate our vision for El Gouna as a leading, global destination. I'd like to express my sincere thanks to all of those involved in bringing this across the finish line.”


About Orascom Development Holding (ODH):

ODH is a leading developer of fully integrated destinations that include hotels, private villas and apartments, leisure facilities such as golf courses, marinas and supporting infrastructure. ODH's diversified portfolio of destinations is spread over 7 jurisdictions (Egypt, UAE, Oman, Switzerland, Morocco, Montenegro, and United Kingdom), with primary focus on touristic destinations. ODH currently operates nine destinations: four in Egypt (El Gouna, Taba Heights, Makadi Heights and Byoum), The Cove in the United Arab Emirates, Jebel Sifah and Hawana Salalah in Oman, Luštica Bay in Montenegro, and Andermatt in Switzerland. The shares of ODH are listed on SIX Swiss Exchange. ODH recently launched O West, the latest addition to its portfolio and its first project in Cairo, Egypt, located in the Sixth of October City.


Contact for Investors:
Ashraf Nessim         
Chief Financial Officer   
Mobile: +20 122 213 1612
Tel: +41 418 74 17 11     
Email: ir@orascomdh.com     
Ahmed Abou El Ella         
Investor Relations Director   
Mobile: +20 122 129 5555     
Email: ahmed.abouelella@orascomdh.com     
Philippe Blangey  
Dynamics Group AG
Tel: +41 432 68 32 35
Email: prb@dynamicsgroup.ch  


Disclaimer & Cautionary Statement

The information contained in this e-mail, its attachment and in any link to our website indicated herein is not for use within any country or jurisdiction or by any persons where such use would constitute a violation of law. If this applies to you, you are not authorized to access or use any such information. Certain statements in this e-mail and the attached news release may be forward-looking statements, including, but not limited to, statements that are predications of or indicate future events, trends, plans or objectives. Forward-looking statements include statements regarding our targeted profit improvement, return on equity targets, expense reductions, pricing conditions, dividend policy and underwriting claims improvements. Undue reliance should not be placed on such statements because, by their nature, they are subject to known and unknown risks and uncertainties and can be affected by other factors that could cause actual results and Orascom Development Holding’s plans and objectives to differ materially from those expressed or implied in the forward-looking statements (or from past results). Factors such as (i) general economic conditions and competitive factors, particularly in our key markets; (ii) performance of financial markets; (iii) levels of interest rates and currency exchange rates; and (vii) changes in laws and regulations and in the policies of regulators may have a direct bearing on Orascom Development Holding’s results of operations and on whether Orascom Development Holding will achieve its targets. Orascom Development Holding undertakes no obligation to publicly update or revise any of these forward-looking statements, whether to reflect new information, future events or circumstances or otherwise. It should further be noted that past performance is not a guide to future performance. Please also note that interim results are not necessarily indicative of the full-year results. Persons requiring advice should consult an independent adviser.

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