Egypt, Saudi offer most scalable opportunities in the region

First Equity Partner (FEP) believes that Egypt and Saudi Arabia are the most important markets for regional long-term private equity players.


Sunday, Nov 15, 2015

Dubai: First Equity Partner (FEP), a regional private equity firm that specialises in turning around underachieving or distressed assets into high-performance businesses, believes that Egypt and Saudi Arabia are the most important markets for regional long-term private equity players because of the size of the economies and scalability of businesses.

“Egypt to us represents a very important market in the region. If one needs to have a share in a scalable business it has to be either in Saudi or Egypt. The size of the economy and population make these two markets very important for private equity players,” said Qais Al Maskati, Managing Director and CEO of FEP.

FEP has a large presence in Egypt, managing the country’s foremost steel producer, Egyptian Steel. In a turnaround story, after acquiring two distressed steel plants in Egypt in 2011, FEP deployed a 30-strong specialist team, who have managed to make these units profitable. Today, together they produce about 700,000 tonnes of steel.

“We are developing two additional greenfield plants, each one with about 850,000 tonnes of steel rebars. One of these plants is going to be operational by the first quarter of 2016 and the other one within a year. They are coming on-stream at a time when Egypt is getting ready to consume massive amounts of steel in its infrastructure development push,” said Al Maskati,

By the end of 2016, when all these plants are up and running, the company expects to produce about 2.5 million tonnes of steel. That would mean about 25 per cent market share. The company, addition to restructuring the operations also raised about 4 billion Egyptian pounds (Dh1.87 billion, $511 million) from local banks. In the next three to four years, it expects get listed on the stock market.

FEP is also present in investment banking business in Egypt acquired an investment banking company White House Company. Now the company is in the process of turning it into an integrated investment bank.

By Babu Das Augustine, Banking Editor

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