The Egyptian private sector has received around 5 billion USD under the signed financing agreement with the multilateral development partners in 2020 and 2021

Newsletter

06 Jun 2022

The Egyptian private sector has received around 5 billion USD under the signed financing agreement with the multilateral development partners in 2020 and 2021, according to the Minister of International Cooperation Rania Al-Mashat. The private sector obtained the financing directly or indirectly through re-lending credit lines for small- and medium-sized enterprises (SMEs), Al-Mashat added. The financings were offered by various development partners, including the IsDB, the European Investment Bank (EIB), the African Development Bank (AfDB), and the European Bank for Reconstruction and Development (EBRD), along with others, she noted. (Arab Finance)

The minister stressed on the importance of bolstering the private sector as a priority of the government in the meantime, as well as encouraging the sector to take part in financing projects, mainly those that contribute to the transition to the green economy.
The government, through the Ministry of International Cooperation and the General Authority for Investment and Free Zones, contributes to the capital of Egypt Company for Entrepreneurship and Investment to support the startups in the fintech sector, she pointed out. Moreover, Al-Mashat said that over 176 companies received direct and indirect investments through Egypt company for Entrepreneurship and Investment. (Arab Finance)
The Egyptian government is in talks with India over a potential swap deal, upon which it could import wheat from the south Asian country in exchange for fertilizers exports, according to the Minister of Supply and Internal Trade Ali Moselhi.
The minister met with the Indian Ambassador to Cairo on June 1st to consider the potential agreement to secure a wheat cargo of 500,000 tons. The North African country has been in talks with the UAE, the US, and Western Europe over wheat shipments, seeking to alleviate potential shortages. The Russian invasion of Ukraine has affected the global wheat supplies, putting Egypt, one of the largest wheat importers in the world, at risk of facing a shortage. In May, the Indian government banned wheat exports to manage food security in the current global situation. It is worth noting that the Indian Ministry of Commerce and Industry announced on May 17th that it eased some of the restrictions imposed on wheat exports, allowing a shipment headed to Egypt. (Bloomberg)
The Egyptian non-oil economy has seen a downturn in demand and activities in May 2022 due to continuous inflationary pressures that affect client spending, according to the S&P Global Egypt PMI™ release issued on June 5th.
The headline seasonally adjusted S&P Global Egypt Purchasing Managers’ Index (PMI) increased marginally to 47.0 in May from 46.9 in April, the data showed. This reading marks the 18th monthly drop in a row in operating conditions, indicating a “deterioration” in the non-oil business conditions, the survey added. The output and new orders, which are the largest contributors to the PMI, came below the 50.0 threshold in May as business activity and demand fell. New orders slipped at the fastest pace since June 2020 due to higher price pressures that caused a slowdown in sales. Moreover, panelists highlighted that customs delays increased in May, which caused a shortage in supplies for many firms, as a result of the ban of some foreign products because of the certification issues and the requirement of letters of credit for imports. (Arab Finance)
Moreover, panelists highlighted that customs delays increased in May, which caused a shortage in supplies for many firms, as a result of the ban of some foreign products because of the certification issues and the requirement of letters of credit for imports.
As for the rate of input cost inflation, it rose to the highest level in six months in May, mainly driven by the impact of the Russian invasion of Ukraine on global commodity prices, along with higher import costs and US dollar value, according to the survey. Additionally, the survey showed that staffing in May has seen a “modest fall”, with the backlog of work sliding. Outlook for future business activity fell to its second-lowest on record in May since April 2012, while businesses are still on balance positive that output would increase over the coming 12 months, with rising concerns over inflationary pressures to limit growth. (Arab Finance)
EFG Hermes Holding (HRHO) has announced that its Investment Banking division closed an 500 million EGP bond issuance as a part of a 3 billion EGP bond issuance program for EFG Hermes’ subsidiary EFG Hermes Corp-Solutions.
The recent bond issuance consists of two tranches; the first is worth 450 million EGP with a two-year tenor, while the second tranche is valued at 50 million EGP with a two-year tenor. The factoring and leasing solutions provider will benefit from the issuance in financing its expansion plans in the year ahead. (Arab Finance)
EFG Hermes Holding (HRHO) has announced the conclusion of its participation as joint bookrunner on the 2 billion USD initial public offering (IPO) of the UAE-based Borouge on the Abu Dhabi Securities Exchange (ADX).
Borouge’s IPO is the largest ever in ADX since the 1.1 billion USD listing of ADNOC. Borouge, a joint venture between ADNOC and Austria’s Borealis AG, has offered 3 billion shares, equivalent to 10% of its capital, on ADX at a price of 2.45 EGP per share. The market capitalization of the company amounts to 20 billion USD. (Arab Finance)
Sarwa Capital, the investment arm of Contact Financial Holding (CNFN) in financing instruments, has signed a cooperation agreement with the Islamic Development Bank (IsDB), Abu Dhabi Islamic Bank (ADIB), and First Abu Dhabi Bank (FAB) for the development of the sukuk market in Egypt.
Moreover, the agreement aims at helping companies to issue sukuk issuing, the statement added. Through the agreement, the IsDB seeks to develop the financing instruments market, mainly the sukuk, to boost the volume of issuances, with a special focus on the USD-dominated sukuk, Managing Director of Thrawa Capital Ayman El-Sawy commented. Sarwa Capital is planning to develop attractive funds that are compatible with the Islamic Sharia, El-Sawy added. He also stressed that the company heavily contributes to the expansion of the investors' base locally and internationally for investment in the financing instruments market in general. (Arab Finance)
A consortium comprised UAE-based Masdar and Egypt’s Infinity Energy will acquire a majority stake in Lekela Power.
The two companies will purchase the stake from the private equity company Actis in a deal that could be sealed at a value of 1 billion USD, the sources highlighted. The deal is almost closed, but is pending regulatory approvals, they added. It is worth noting that Lekela has a portfolio of over 1,000 megawatts (MW) of wind assets across Egypt, Senegal, and South Africa, along with a wind development with a capacity of 225 MW in Ghana. In March, CEO of Lekela Power Chris Antonopoulos told Al Borsa News that Lekela Power plans to boost its investment in Egypt to reach 1 billion USD within the coming four years. (Reuters)
B Investments Holding (BINV) has signed a Share Purchase Agreement (SPA) with Arabian Internet and Telecommunication Company (Solutions) to sell its entire stake in Giza Systems.
The agreement has been signed after B Investments announced on April 3rd that it accepted a binding offer for the acquisition of its 44.7% stake in Giza Systems by Solutions. The transaction will be carried out in accordance with Article 43 of the EGX Listing Rules. It is worth noting that B Investments Holding’s consolidated net profit attributable to the parent company stood at 22.305 million EGP in Q1 2022, versus 50.62 million EGP in the year-ago period. (EGX)
The Islamic Development Bank (IsDB) has opened its first regional headquarter in Cairo, Egypt.
This announcement was made during the IsDB’s 2022 Annual Meetings, which was held in Sharm El Sheikh under the supervision of President Abdel Fattah El-Sisi to discuss economic and financial developments. It is worth that the Vice President of IsDB Amer Bukvic revealed that the bank invested 4.3 billion USD in member countries and Islamic communities across the world to alleviate the impact of the Covid-19 pandemic. (Arab Finance)
Beltone Financial Holding (BTFH) has received a preliminary non-binding offer from WM Legal Consultancy for the acquisition of a majority stake of between 51% and 90% in the company.
The indicative price of the offer has been estimated at EGP 1.35 per share, which is subject to changes depending on the due diligence. The offer has been presented through a consortium of strategic investors. Beltone is an Egypt-based company, which operates within the diversified financial sector focusing on investment banking and brokerage. The company develops an online trading platform, called Beltone Trade, as well as provides brokerage services, asset management, investment banking, liquidity services in regional markets, and research and analysis services. (Al Mal)
Telecom Egypt (ETEL) has signed six commercial and strategic agreements worth 17 billion EGP with Etisalat Misr for cooperation in the fields of infrastructure and roaming.
Under the agreements, Telecom Egypt will provide Etisalat Misr with services including infrastructure, access, and voice services which will allow the latter to upgrade the quality of its services. The signing included a 10-year term transmission deal at a value of 12.5 billion EGP for the expansion of Etisalat Network via Telecom Egypt’s infrastructure. The two companies also signed fiber to the site (FTTS) agreement under which “Telecom Egypt will provide access services with ample capacities on optical fiber for Etisalat mobile towers.” Moreover, both telecom operators have signed an amendment to the national roaming agreement, which was signed earlier in 2017, to enable Telecom Egypt to grow capacities on Etisalat Misr's network in 2022. (Al Mal)