Arabtec closer to deal over stalled contract for million homes in Egypt

Arabtec’s stalled plans to build a million low-cost houses in Egypt may have moved a step closer after the company reportedly reached some terms with the Egyptian housing ministry.

After weeks of haggling over a land deal for the ambitious US$40 billion project, ministry officials have said that some terms have been reached and a final agreement could be signed by the two sides within 10 days

Wafaa Bakri, media adviser for the housing minister, told Reuters yesterday that Arabtec executives will visit Cairo within 10 days to sign a final deal on the project.

The development comes after the Egyptian housing minister Mustafa Madbuli said on Saturday that all problems with Arabtec had been resolved.

Arabtec declined to comment on progress over the negotiations to build homes on 13 sites across the country but insiders agreed that it expected to sign a final agreement “soon”.

Top Arabtec executives flew to Egypt this month in a last-ditch attempt to salvage the high-profile project, hoping to reach a deal before last week’s Egypt the Future conference in Sharm El Sheikh after reports in the Egyptian press speculated that the project was no longer going ahead.

Yet insiders point out that the comments made by the Egyptian government have become more positive since the conference took place and especially after the Abu Dhabi state-owned fund Ipic, which controls 98.25 per cent of Arabtec’s majority shareholder Aabar, agreed to partner Cairo-based Orascom to finance a 3,000 megawatt coal-fired power plant in Egypt.

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Lucy Barnard

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