The Egyptian Chemical Industries Company (KIMA) is selling all of its 2.7 % stake in Abu Qir Fertilizers and Chemical Industries Company to the Chemical Industries Holding Company (CIHC), according to a disclosure by KIMA to the local bourse.

The move comes to enhance financial liquidity and settle operational expenses, especially the cost of the nitric acid and ammonium nitrate project, according to the disclosure.

In October 2023, KIMA signed a turnkey agreement with a consortium comprising Italy’s Tecnimont and Egypt’s Orascom Construction to build a new nitric acid and ammonium nitrate complex in Aswan. To fund part of the project, KIMA signed a syndicated loan agreement with a consortium of local banks.

The company was supposed to pay back the loan from its urea exports throughout the project’s construction period (34 months) to cover the majority of the dollar-denominated investment costs. It was also supposed to raise EGP 4 billion in fresh capital to cover operating expenses during construction.

However, the Financial Regulatory Authority (FRA), the regulator of the non-banking financial activities in Egypt,  objected to raising capital to cover the operating costs, leaving KIMA unable to bridge its funding gap.

In response, CIHC stepped in during  2024 and injected EGP 500 million into KIMA’s capital, to enable the company to meet its financial obligations to the banks.

Despite these measures, KIMA still faces a liquidity deficit of about EGP 800 million. To avoid breaching the terms of its loan, the board agreed in August 2025 to sell all or part of its shares in Abu Qir Fertilizers to CIHC. Proceeds from the sale will be used to settle nearly EGP 597 million owed to banks, including accumulated interest, and to ensure the continued operation of KIMA’s ammonia and urea plants, whose revenues are critical for financing the nitric acid and ammonium nitrate project.