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Tue 7 Jun 2011 07:59 PM

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Prince Alwaleed signs new Egypt farm land deal

Egypt gov't says Saudi billionaire has inked new contract for land allocated to his Kingdom unit

Prince Alwaleed signs new Egypt farm land deal
Saudi Prince Alwaleed bin Talal. (AFP/Getty Images)

Egypt settled one of a string of disputes over state land sales under deposed President Hosni Mubarak, revising the terms of a farmland deal with Saudi Prince Alwaleed bin Talal, the Egyptian government said on Tuesday.

The Saudi billionaire signed a new contract with the Egyptian government for land allocated to his Kingdom Agricultural Development Holding (KADCO), the cabinet said.

Land sale scandals have torn through Egypt's once booming housing sector and gathered pace after Mubarak's overthrow in a popular uprising.

Courts have scrapped land contracts for Egypt's two largest property developers, Talaat Moustafa Group and Palm Hills and two former government ministers have been sentenced to jail over graft in state land sales.

KADCO, part of Alwaleed's Kingdom Holding Co, bought 100,000 feddans (420 million sq m) at Toshka in southern Egypt in 1998 as part of a project to irrigate reclaimed agricultural land near the Sudanese border.

Egypt's public prosecutor said in April that the sale violated the law and the Saudi company later agreed to give back 75,000 feddans, according to Egypt's government.

The new deal stipulates that the company will own 10,000 feddans while cultivating another 15,000 feddans that it would take ownership of at a later date, a government spokesman said in April.

Egyptian Prime Minister Essam Sharaf described the new deal as a sign the government intended to correct "mistakes" in investment and trade deals signed by previous governments, a cabinet statement said on Tuesday.

"This deal signing ... reflects the government's approach to encouraging Arab and foreign investments through amicable negotiation to reach satisfactory solutions for both parties that agree with the law," Sharaf said.

The government has said it was setting up a committee to settle problems surrounding investment contracts.

Dubai property developer Damac said last month it had filed an international arbitration case against Egypt over a land dispute and the conviction of its chairman and owner Hussain Sajwani.