ORASCOM DEVELOPMENT EGYPT
ORHD
Real estatePositive News
Orascom Development Egypt Secures $155M IFC Loan to Fuel Growth and Refinance Debt
Orascom Development Egypt secures $155M IFC loan to refinance debt and expand hotel operations in El-Gouna.
October 16, 2024 at 2:34:00 PMScore: 85

Orascom Development Egypt (ORHD) has secured a $155 million loan facility from the International Finance Corporation (IFC). The funds will primarily refinance existing debt and support hotel business expansion in El-Gouna, including capital expenditures for property renovations. The loan features a 2.5-year grace period and an 8.5-year tenure, with repayments beginning in late 2027. Group CFO Ashraf Nessim highlighted the deal's role in optimizing financing terms, reducing capital costs, and maintaining a net debt-to-EBITDA ratio below 0.4x. The company also recently sold a commercial building for EGP 332 million in August.
Recommended Actions
- Consider holding ORHD shares for long-term growth
- Monitor El-Gouna tourism metrics post-renovations
- Track quarterly liquidity reports for debt management
- Watch for EBITDA trends relative to 0.4x debt ratio
- Evaluate entry points based on post-refinancing stock performance
Positive Aspects
- Lower financing costs improve free cash flow
- Debt restructuring signals financial health
- Strategic investments in high-potential tourism assets
Negative Aspects
- Long repayment period starting in 2027 may pose cash flow risks
- Dependence on El-Gouna tourism performance