Sphinx Glass in the centre of international press

I am used to this now, says Mohammad Abdel-Hamid , who is living in a suburb of Cairo.

In the early morning he gets ready for another working day in Sphinx Glass Plant, situated in Sadat City north of Cairo. He spends his 10 working hours in front of the glowing glass furnace and then takes the long journey back home again. This means 5 hours of traveling every working day, but Hamid has found the best argument of all: "This is a secured job!"

Hamid has been working everyday during the ongoing “second revolution”, which started a week ago. The protest against the president started 30 of June, and on Wednesday July 3rd, the president was taken out from his position.

I have a wife and a three years old son to take care of, so I prefer to be at the plant instead of being in the streets, said Mohammad.

The float glass plant of Sphinx Glass is an exception in the downhill spiral of the Egyptian economy. In three years the production line has increased its capacity and is now exceeding 600 tons/day, and there are ongoing discussions to start building a second production line.

We are not reducing the personnel number, in contrary the production is increasing and the financial results are good, says Mohamed Marzouk, the production manager. Sphinx Glass is a part of Norway. The owner of the company is the biggest investment company in Africa - Citadel Capital- having the Norwegian Pension Fund as a fourth biggest owner with about 2 % of the shares.

In the city-center of Cairo, facing the Nile River, lays the head office of Citadel Capital group. After some violent days, life pace is back to normal, but even for one of the most influential businessman, it is indeed a very hard time. Capital is less available in the last two years , says Mr. Ahmed Heikal, the founder of Citadel Capital. He is thankful to the patient European stockholders, who are giving him trust and support during this period, including the Norwegian Bank Investment Management (NBIM), who controls the Pension Fund. The Norwegian Fund is acting for the long term and is very professional in the negotiations, says Mr. Heikel. The fund made its first investment in Egypt in 2005, and today the invested amount of money is about 1,2 billion EGP. Citadel needs investors that are patient, as the economical crisis of the last years have made it impossible to generate profits in greenfield companies after 5 to 8 years, which is the regular demand from investment companies nowadays.

The market for investment companies was not healthy in Egypt after the financial crisis in 2008, says Heikal. Capital has become a “trading product”, that’s why we are now focusing as a private equity investment company within a few sectors only, which will give us a longer term view in investments. If more capital is needed, we are able to sell branches that are not important to us. He mentions that during different regimes who are giving different signals to the business, keeping the balance was not easy with the lack of long-term strategic direction for the governments.

I think that the risk will decrease, says Mr. Heikel, but it is very hard to predict when this will happen.