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Someone has eyes for Middle East Glass. PLUS: Big Network International investment and news from Mashreq, Ethydco, Somabay, Quintessentially, and the banking industry
INVESTMENT- Network International to make nine-figure EGP investment in Egypt: Dubai-based fintech firm Network International will invest EGP 1 bn in the Egyptian market to boost digital payments across the nation, it said in a press release. The investment will go towards procuring, deploying, and maintaining some 100k point-of-sale machines as well as implementing Network International’s payment platform Network One across the country. Network International is well-acquainted with the local market having operated here for over two decades. It launched a digital payments service in the country earlier this year. ICYMI- Network International is the target of an acquisition bid by Canadian private equity outfit Brookfield Business Partners, which has offered to pay USD 2.76 bn to take over the payments firm. M&A- Gulf Capital could sell down stake in Middle East Glass: Unnamed investors are eyeing the purchase of Gulf Capital’s entire 37% stake (23.1 mn shares) in EGX-listed bottle maker Middle East Glass(MEG), according to am EGX filing (pdf) yesterday. Gulf Capital is requesting that MEG allow the potential investors to commence the due diligence process ahead of the sale. Arqaam Capital is acting as the sell-side advisor. Who owns what? Parent firm MENA Glass Holding holds 53% of MEG, while Gulf Capital’s 37% stake (owned through special purpose vehicle MTM Packaging 2) makes it the second-largest shareholder. ICG Holdings owns 6%. DEBT- Ethydco could get USD 100 mn in finance from our friends at Mashreq: Mashreq is considering lending the Egyptian Ethylene and Derivatives Company (Ethydco) USD 100 mn to fund its working capital, Al Shorouk reports, citing sources it says are in the know. The loan is separate from another two-year, USD 250 mn loan that Ethydco is seeking from the Emirati lender to refinance existing debt to local banks. Remember: EGX-listed Sidpec, which currently owns 20% of Ethydco, has been in the process of acquiring the remaining shares in the company since last year. The firm plans to finalize the merger by the end of 3Q 2023. INFRASTRUCTURE - Construction starts on Luxor strategic warehouse: The government broke ground on its EGP 1.5 bn strategic warehouse in Luxor yesterday, according to a Supply Ministry statement. Set to serve Luxor and four neighboring governorates, the warehouse will take 18-24 months to build and will store strategic reserves of over 30 essential commodities and other goods, the statement reads. More warehouses to come: The government has signed EGP 4 bn worth of contracts with our friends at Hassan Allam Utilities, Orascom Construction, and Samcrete to set up four of these warehouses in Suez, Luxor, Sharqia, and Fayoum. The Luxor project is the second to go into construction after contractors in June broke ground on the Suez facility. BANKING- Banking bill ratified: aiBank, the Export Development Bank (EBank), and the Agricultural Bank of Egypt have until 23 August, 2024 to align their regulations with the 2020 Banking Act, after President Abdel Fattah El Sisi ratified a bill that revoked the three lenders’ outdated establishing laws. The new bill was published in the Official Gazette. The Central Bank of Egypt has the authority to extend the deadline for the banks to comply by up to two years. REAL ESTATE- Somabay will offer global concierge services through Quintessentially Egypt for all homeowners in its developments after a successful pilot scheme, according to a press release (pdf) by Quintessentially Egypt.The 24/7 service will allow Somabay residents to make shopping, travel, dining, and other requests to Quintessentially’s “lifestyle managers” through the new Somabay Lifestyle app. FINTECH- Mastercard x Ingiz: Mastercard will provide local fintech startup Ingiz with compliance, security and fraud prevention tools, according to a joint press rele ase (pdf).

Monday, 28 August 2023

MPs pass law to unify banking regulations
MPs pass banking bill: The House of Representatives yesterday approved a government-proposed bill that will revoke the establishment laws of the Arab Investment Bank (aiBank), the Export Development Bank (EBank), and the Agricultural Bank of Egypt. The rationale: Each of the banks are regulated by the 2020 Banking Act but also operate under their own separate establishment laws, a couple of which date back more than three decades. The newly-approved bill aims to align these lenders with the current banking regulations, ensuring parity among all banks operating in the country and removing any potential obstacles to restructuring them, said House Economic Affairs Committee Chairman Mohamed Soliman. This will mean that they will all be regulated exclusively by the Banking Act. The revoked laws are outdated:aiBank’s establishment law was written to help it carry out its original purpose to support investment and development projects in the long-defunct Federation of Arab Republics (Egypt, Syria and Libya). Meanwhile, EBank’s establishment law makes no distinction between ownership and management rights and places limitations on who can own shares in the bank, hindering the lender’s restructuring efforts and making it difficult to improve governance.Remember: EFG Holding and the Sovereign Fund of Egypt (SFE) acquired a 76% stake in aiBank in 2021.AND- MPs gave their final approval to several other bills yesterday: Five bills licensing the Oil Ministry to contract foreign firms Eni subsidiary IEOC, BP, and Wintershall Dea to explore for gas in the Med, each in partnership with state-owned EGAS; An EUR 3.3 mn grant to renovate Cairo Metro’s Line 1 and an EUR 1.8 mn grant to renovate Line 2, both from the European Bank for Reconstruction and Development; A bill making official Egypt’s membership of the African Continental Freetrade Area (AfCFTA)agreement; andA bill changing the name of the Nasser Military Academy to the Military Academy for Higher Studies and Strategies. The House is now taking a week-long break and will reconvene on Tuesday, 20 June.

Wednesday, 14 June 2023

Edita raises Molto price points
Bestselling snack is getting (slightly) more expensive: Edita Food Industries raised the price of Molto by EGP 1 (pdf), and is now selling two ranges of the packaged croissants at EGP 3 and EGP 4, in a bid to improve its bottom line following the global boom in commodity prices. Their EGP 5 croissants were left unchanged.Other things we’re keeping an eye on this morning: ADIB Egypt gets green light for consumer finance arm: Abu Dhabi Islamic Bank in Egypt has obtained regulatory approval to launch its consumer finance arm, ADI-Consumer Finance, according to a statement.Egypt-Cyprus double taxation treaty ratified: President Abdel Fattah El Sisi has ratified the 2019 agreement between Egypt and Cyprus to eliminate double taxation, according to a decision published in the Official Gazette.Oaks Hotels will debut its brand in Egypt with a 400-room hotel in the new administrative capital by 2025.The tourism and higher education ministries signed an MoU yesterday that will give international students access to the same discounted ticket prices as local students when visiting antiquity sights. Misr Life Ins. signed an agreement with the Agricultural Bank of Egypt to provide its services through the bank’s branches in rural areas.

Monday, 25 October 2021

KUDOS | EnterpriseAM
Kudos on 15 April 2021
KUDOS- Art D’Égypte’s founder Nadine Abdel Ghaffar was awarded last week the Chevalier de L'Ordre des Arts et des Lettres by French Ambassador to Egypt Stéphane Romatet for her contributions to the art scene in Egypt, according to a statement. Eastern Company CEO Hany Aman (LinkedIn) was recognized with a Leaders 2020 award after the state-owned tobacco company reported the highest sales and revenue figures in its history. Eastern Company’s net income grew 10% y-o-y in 2020, despite the pandemic-induced global disruption in supply chains and business performance. Business process outsourcing provider Raya Contact Center was selected to join the 2021 Global Outsourcing 100 list, by the International Association of Outsourcing Professionals. Amazon is helping provide 1 mn meals to families in need in Egypt, the UAE, Saudi Arabia, and Jordan this Ramadan, according to a statement (pdf). Amazon’s contributions include “products, services, and monetary donations, including grocery supplies and packing materials.” People with visual and hearing disabilities will be able to access a range of mobile apps designed for them at no charge after the National Telecommunications Regulatory Authority ordered mobile network operators to allow users to download the apps without deducting from monthly internet packages, the local press reports. The apps include Be My Eyes, TapTapSee and Cash Reader for the visually imparied, as well as sign language chatbot Wasel. Visually impaired customers at the Agricultural Bank of Egypt can also access key services in braille, which the bank is providing in partnership with Al Nour Wal Amal Association, El Watan reports. Many documents will be available in braille at the Agricultural Bank’s main branches across the country.

Thursday, 15 April 2021

Also on our Radar on 31 March 2021
Egypt-Sudan electricity link gets a boost: Siemens Energy was awarded a contract to build two grid stabilization stations in Sudan that will help feed cross-border electric power to Egypt as part of the Egypt-Sudan Electric Interconnection Project. The stations come as Egypt has agreed to invest EGP 450 mn in the supplying and installation of power compensators to boost the link’s capacity to 300 MW.Osool ESB Securities Brokerage is offering margin with the help of a EGP 350 mn loan from Abu Dhabi Islamic Bank's ADILease, the local press reports. The MoU follows regulatory amendments by the Financial Regulatory Authority earlier this month which gave Egyptian factoring companies the green light to finance margin lending by brokerage companies. The move comes as a bid to allow brokerages access to new funding sources and stimulate trading on the EGX.Other things we’re keeping an eye on this morning: Contact and Fawry have signed a partnership agreement (pdf) to allow clients of the consumer finance company to make installment payments through Fawry’s mobile app.Zack’s Fried Chicken is planning to invest EGP 12 mn to set up four new branches of Burger Joint, which it acquired earlier this year, according to Zack’s founder Hassan Abouzekry.The Central Bank of Egypt will provide an additional EGP 1 bn for onlending to the Agricultural Bank of Egypt for the provision of low interest loans to SMEs as part of a government project to support cattle farming.Pharos Energy’s revenue share of its Fayoum oil-producing concession could increase from 30% to 40% after the Egyptian General Petroleum Corporation gave its preliminary approval to amendments to the terms of an earlier agreement.The Rixos Premium Magawish Hotel was inaugurated yesterday in Hurghada as part of development plans for the Magawish tourist village.The owner of the 10-storey building that collapsed last week in Cairo's Gesr El Suez neighborhood was arrested on charges of illegally adding four floors, causing the building's collapse.

Wednesday, 31 March 2021

Speed Round | EnterpriseAM
EGX to purchase 30% of commodities exchange management company
EGX to claim 30% ownership of commodities exchange; who will own the futures exchange still to be determined: The EGX is staking its claim to the as of yet unestablished commodities exchange, according to statements by EGX Chairman Mohamed Farid picked up by Al Mal. The EGX will hold a 30% stake in the exchange. The EGX’s stake is part of the government’s 50% ownership share in the new exchange, with other shareholders set to include the General Authority For Supply Commodities (GASC), the Internal Trade Development Authority (ITDA), and the Egyptian Holding Company for Silos and Storage, according to previous statements by Supply Minister Ali El Moselhy. 49% of the EGP 100 mn exchange will be held by (mostly state-owned) commercial and investment banks, as well as a host of other state and quasi-state entities, such as Misr for Central Clearing, Depository and Registry (MCDR), the state Insurance Holding Company, the Federation of Egyptian Chambers of Commerce. State-owned banks expected to hold those shares include Banque Misr, the National Bank of Egypt, and the Agricultural Bank of Egypt. EFG Hermes and CIB are the two standouts from the private sector said to be likely to take a stake. But Enterprise, wasn’t the commodities exchange already established in March? No it wasn’t. The domestic press appears to have jumped the gun on this back in March. The latest statements by Farid indicate that the ownership stakes have yet to be determined, as is the establishment of the exchange’s electronic trading platform. A final decision on which commodities will be traded still hasn’t been made, although ITDA head Ibrahim Ashmawy assures Al Mal that this “is happening soon.” We’re waiting to hear back from the EGX on whether trading in the exchange will start in September as earlier announced. Background: The Egyptian Commodity Exchange was given the greenlight by the Cabinet in January. The exchange was expected to initially trade in six commodities — wheat, rice, corn, potatoes, onions, and oranges. It is unclear whether these commodities will underpin the as of yet established commodities future exchange.And speaking of the futures exchange, a meeting yesterday to set the regulations governing it has yet to determine whether the private sector will be allowed to own shares. One thing that was made clear is that 75% of shares in the exchange — which will launch derivatives trading in Egypt — must be held by one or more financial institutions, whether they be state-owned or private, according to statements by FRA chief Mohamed Omran (pdf) at the meeting. The meeting was attended by MCDR, the EGX, as well as private-sector commercial and investment banks, insurance companies and representatives from the EBRD and the International Finance Corporation. Omran closed out the meeting by forming a working group to draft the regs and guidelines for the exchange. It is still unclear when this will be launched.

Wednesday, 26 August 2020

Speed Round | EnterpriseAM
Egypt obtains EGP 200 mn SME grant from Saudi Arabia
KSA to give EGP 200 mn grant to five Egyptian MSMEs: Saudi Arabia will provide EGP 200 mn to finance five new micro, small, and medium enterprises in Egypt, International Cooperation Minister Rania Al Mashat said yesterday. The Agricultural Bank of Egypt will receive EGP 100 mn to finance a rural development project, livestock supply chains, and dairy factories. A healthcare support program by Contact Financial Leasing and a SME logistics support program by UE Finance will receive EGP 50 mn each.

Monday, 29 June 2020

Speed Round | EnterpriseAM
Agricultural Bank of Egypt names veteran banker Alaa Farouk as chairman
MOVES- National Bank of Egypt (NBE) retail CEO Alaa Farouk (LinkedIn) was reportedly tapped as chairman of the Agricultural Bank of Egypt, and will take on his new role within days, Masrawy reports, citing industry sources. The veteran banker has been NBE’s retail boss since August 2018. He joined NBE in 2009 following 26 years at Barclays Bank Egypt (absorbed in 2017 by Attijariwafa Bank), where he eventually became head of the Alexandria, Delta, and Upper Egypt area.

Thursday, 6 February 2020

Ernst & Young wins tender in ABE technology upgrade project
Ernst & Young has won a tender to act as financial advisor to the Agricultural Bank of Egypt (ABE) in the bank’s development of its technology infrastructure, ABE Chairman El Sayed El Qasir told Masrawy. The bank is still in the market for a company to carry out the upgrade, and is currently working on the booklet of conditions for that tender, El Qasir said.

Sunday, 21 July 2019

Farmer’s syndicate head calls on CBE for bank loan extension
Farmer’s Syndicate head Hussein Abdel Rahman called on the Central Bank of Egypt (CBE) to extend the deadline for its initiative to support farmers, under which banks exempt debtors from paying accrued interest on unpaid loans if they pay their principal amounts before 31 December, AMAY reports. Under the CBE’s initiative, state-owned banks settle debts under EGP 10 mn with “distressed” farmers and businesses, withdraw any legal charges, and remove debtors from the CBE and the Egyptian Credit Bureau (iScore) blacklists.

Wednesday, 19 December 2018