By Alastair Sharp and Patrick Werr CAIRO (Reuters) - Egypt's state-owned Misr Insurance may launch an initial public offering of its life unit by July 2010, if conditions permit, but the state will keep a majority, the Insurance Holding Company chairman said on Monday. A move to launch an IPO in a big state financial firm would give renewed impetus to a privatisation programme that lost momentum after the government cancelled the sale of a majority stake in Banque du Caire last year, saying bids were too low. "We are going through (with) an IPO, when the capital is needed and when the marekt is ready," Insurance Holding Company chairman Mahmoud Abdallah told Reuters. "Under no circumstances will we have a strategic investor. "If the market condition permits and all the requirements have been fulfilled, it could be the end of the fiscal year (2009/10 for an IPO) or the beginning of the new (fiscal) year," he said. He was clarifying earlier remarks suggesting a sale could take place by end-2009. Egypt's financial year starts on July 1. Asked how much would be offered in the IPO, he said: "That all depends on the market appetite, but we have no intention at this stage to lose control." He said the first move would be to split Misr Insurance separating the life insurance unit from the non-life insurance operations before the end of fiscal 2009/10. Misr Insurance, which is owned by the state holding company, has assets of 22 billion Egyptian pounds, Abdallah said. Reham ElDesoki, an analyst at Beltone Financial, said the potential sale could push forward the reform programme begun by the cabinet of Prime Minister Ahmed Nazif. "This a long awaited move in the insurance sector, which had been gearing up for a long time and this could mean that the government is finally ready to move on privatisation in general and insurance specifically," she said. "The potential of the sector lies in its large base of assets, which could be invested in the economy, and its mobilisation of large savings," she added. Egypt merged two of its state insurance companies into a third, Misr Insurance, in 2007, and is transforming its fourth, National Insurance Company of Egypt, to specialise in life, pensions and health insurance. At the same time, Egypt has opened up its insurance industry to private companies, which Abdallah said had not negatively affected the state firms. "The public companies achieved record earnings despite the fact that we opened the market," he said. "We created growth in premiums and higher profit margins." | 
