GCC Firms Continue Acquisition of Egyptian Companies

GCC investors continue to buy companies in Egypt and latest one is Abu Dhabi-based electrical equipment manufacturer Electra Investment Holding, which has acquired 20% stake equal to 427.7 million shares in Egypt’s Elsewedy Electric. Electra paid $1.05 per share, putting the transaction’s value at around $449.1 million.

Electra submitted an offer in May this year targeting to acquire 15% to 24.5% stake in Elsewedy Electric, which is over 76% collectively owned by the Elsewedy family, the Egyptian Stock Exchange (EGX) said.

EFG Hermes was Electra’s sole financial advisor, while BDO Keys Financial Consulting was Elsewedy Electric’s financial advisor. MHR & Partners in association with White & Case were Electra’s legal advisors on the transaction.

The UAE companies such as Masdar, has been investing heavily in major sectors such as tourism, renewables, shipping and ports among others.

The UAE government, through its investment arm ADQ, has announced plans to invest $35 billion in a construction project at Ras al-Hikma, a Mediterranean peninsula near the city of Alexandria. It is thought to be the biggest such investment in Egypt’s history.

ADQ has also acquired Egypt’s Amoun Pharmaceutical Company from Canada’s Bausch Health for $470 million, as part its plans to strengthen its long-term healthcare and pharmaceutical portfolio in 2021.

At the end of same year, ADQ opened an office in Cairo, and over the past few years has bought stakes in listed Egyptian companies. The deals include investments in Commercial International Bank, digital payments platform Fawry, logistics player Alexandria Container and Cargo Handling Company, Misr Fertilisers Production Company, and Abu Qir Fertilisers and chemical units.

More Investments in RAK Properties

In a related development, the Ras Al Khaimah government raised its stake in RAK Properties to 34%, up from 5%, after receiving final approvals from the Securities and Commodities Authority (SCA).

In March, RAK Properties held its annual general meeting (AGM) and cleared a proposal to increase its capital of $250 million by issuing 920 million new shares to increase the government’s stake.

Following the March AGM where the Government, subject to ADX approval, expressed confidence in RAK Properties to expand their stake, the company has now moved forward with the strategic government partnership which will see their stake in the company increase to 34%.

Recognizing RAK Properties’ unwavering commitment to developing lifestyle destinations, including its flagship projects Mina Al Arab, Hayat Island and Raha Island, the up-weighted stake reflects the Government’s confidence and the perceived value of master plan-led developments and their critical role in the Emirate.

RAK Properties Chairman Abdulaziz Abdullah Al Zaabisaid that the government’s investment and increased stake in RAK Properties underscored the belief in their vision.

“This collaboration will not only provide us with the resources to accelerate our growth and innovation but also reinforces our commitment to bringing luxury living to RAK. Together, we are poised to drive forward transformative economic, social, and environmental projects that will benefit Ras Al Khaimah,” he added.