12 April 2013
EFG-Hermes, Egypt's largest investment bank, has released a statement saying its merger deal with the Qatari company Qinvest may not be executed if the Egyptian Financial Supervisory Authority (EFSA) does not approve it before 4 May.
The statement noted that EFG-Hermes had secured regulatory approvals for the deal, expected to generate $300 million in foreign direct investments in Egypt, from all the markets it operates in.
EFG-Hermes said it had started ownership transfer procedures on 3 February and had addressed all the EFSA's requirements, but had not so far received the necessary "no objection" call.
Commenting on the statement, the research department of Pharos said the statement aimed to explain to shareholders the key reason behind the delay and indirectly exert pressure on the authorities, particularly the Central Bank of Egypt, to expedite the execution by quoting the size of the foreign currency inflow generated by the deal.
Pharos agreed with Beltone Financial that there was a risk the deal would not go through. "The extended delay in the EFSA's clearance, the upcoming agreement expiry, the 13 per cent depreciation in the pound since the agreement, and the company's statement have all prompted us to look into a scenario in which the transaction does not go through," said a Beltone note.
EFG-Hermes, Egypt's largest investment bank, has released a statement saying its merger deal with the Qatari company Qinvest may not be executed if the Egyptian Financial Supervisory Authority (EFSA) does not approve it before 4 May.
The statement noted that EFG-Hermes had secured regulatory approvals for the deal, expected to generate $300 million in foreign direct investments in Egypt, from all the markets it operates in.
EFG-Hermes said it had started ownership transfer procedures on 3 February and had addressed all the EFSA's requirements, but had not so far received the necessary "no objection" call.
Commenting on the statement, the research department of Pharos said the statement aimed to explain to shareholders the key reason behind the delay and indirectly exert pressure on the authorities, particularly the Central Bank of Egypt, to expedite the execution by quoting the size of the foreign currency inflow generated by the deal.
Pharos agreed with Beltone Financial that there was a risk the deal would not go through. "The extended delay in the EFSA's clearance, the upcoming agreement expiry, the 13 per cent depreciation in the pound since the agreement, and the company's statement have all prompted us to look into a scenario in which the transaction does not go through," said a Beltone note.
© Al Ahram Weekly 2013
