UAE Companies On Acquisition Spree In The Regional Markets

There has been a flurry of activity among the UAE companies to acquire well-known companies in Egypt in the recent past.

The first nine months of 2021 witnessed an increased activity for mergers and acquisitions deals in the Middle East after the slowdown caused by COVID-19 in 2020, bringing the total to 323 deals compared to 175 during the same period in 2020.

A PwC report entitled “TransAct Middle East” released in November last said that the UAE topped the countries in the region with 113 deals, followed by Egypt with 95 deals. Saudi Arabia also witnessed the completion of 61 deals.

String Of Acquisitions

While First Abu Dhabi (FAB) offered to acquire 51% shares of EFG Hermes Holdings Egypt, which are valued around $600 million, last week, it was preceded by a string of acquisitions by other UAE entities in the Egyptian and other Middle East markets in the last one year.

In December 2021, a consortium of Aldar Properties, the biggest developer in Abu Dhabi, and one of the region’s biggest holding companies ADQ, has acquired 85.52% outstanding share capital stake in Egypt’s Sixth of October for Development and Investment Company for $386.8 million.

Aldar had made a non-binding offer in March 2021 to buy at least 51% of SODIC at a price ranging between $1.15-1.21 per share, bringing the average value of SODIC to $420 million.

The Abu Dhabi based consortium, which is controlled 70% by real estate developer and manager Aldar and 30% by ADQ, one of the region’s largest holding companies with a broad portfolio of major enterprises spanning key sectors of Abu Dhabi’s diversified economy, will focus on identifying growth opportunities and guiding the company’s long-term strategy.

The consortium’s objective is to advance SODIC’s position as a leading national developer by scale and reputation, growing its portfolio of mixed-use residential communities in Greater Cairo, the North Coast and other major markets.

Agthia Takes Over Atyab

The UAE-based Agthia Group, the region’s leading food and beverages company in September last year completed the strategic acquisition of a 75.02% stake in Ismailia Investments (Atyab),  a prestigious Egyptian producer of frozen processed chicken and beef products.

However, the amount was not disclosed by both companies. Earlier, Agthia acquired Nabil Foods in Jordan.

Abu Dhabi’s holding company ADQ acquired Egyptian drug developer Amoun Pharmaceutical after Canada’s Bausch Health announced selling its entire equity interests in the Pharmaceutical firm for $470 million in April 2021 as part of building its healthcare portfolio.

FAB and Bank Audi Egypt

First Abu Dhabi Bank – Egypt (FAB), in collaboration with the Central Bank of Egypt (CBE), has acquired 100% shares of Bank Audi – Egypt, valued around $600 million, in January last year after completing the required audits, and due diligence works on Bank Audi to obtain the regulatory approval from the Central Bank of Egypt. The merger is expected to be completed this year.

Bank Audi’s total assets totalled $5.3 billion as of September 2020, while total shareholders’ equity amounted to $479 million.

Bank Audi, the Lebanon-based parent company of Bank Audi Egypt, said that the acquisition would enhance the services of its Egyptian unit and its network of 53 branches, noting the number of FAB branches in Egypt has reached 17 since 1975.