Egypt's CI Capital PE for Fund Management and Investment (CIPE), which is part of  CI Capital financial services group, plans to launch an investment fund worth EGP 1 billion ($21 million) to invest in troubled industrial companies, in partnership with local banks and financial institutions, Mahmoud Khalifa, Executive Investment Director of CIPE told Zawya Arabic.

Quick Background

The Egyptian government had announced plans to launch an initiative to restart approximately 6,000 distressed factories, including the establishment of an investment fund,  according to previous statement by Kamel Al-Wazir, Minister of Industry, last month. This is the fund that CI Capital Private Equity company will launch, according to Khalifa،

According to the minister's previous statement that outlined the fund's criteria, the fund will invest in factories facing financial difficulties in exchange for a stake in their ownership, based on each factory's needs and its recovery plan. The fund is entitled to recover its investments after ensuring the factory's return to production and stabilization of its operational conditions.

More Details

"The fund, with a value of EGP 1 billion will invest in struggling factories, taking a minority stake in them. Its role is to re-start these factories or create value in them so that they can stand on their feet again," said Khalifa. He noted that financially troubled factories in Egypt are those operating at an efficiency level of only 5-10%.

The fund, which is planned for a five-year term, targets specific sectors, including food, medical supplies and pharmaceuticals, engineering and chemical industries, Khalifa said. 

He noted that the maximum support for each factory will be EGP 50 million, with the investment period for each project ranging from 2.5 to 3 years.

Khalifa expected the fund’s establishment procedures to be completed during the current quarter.

Click here to read the article in Arabic.