First Equity Partners Capital-Egypt (FEP Capital) launched two companies in the stock market of small and medium enterprises (SMEs), the Nile Stock Exchange (NILEX), in 2015, Chairman Abdullah Al-Shahin said.
The two IPOs are equivalent to 50% of the total companies’ IPOS in NILEX throughout the whole year, Al-Shahin continued. This put the company at the forefront of sponsoring companies for the registration and launching of companies in NILEX, he said.
Al-Shahin further noted that FEP Capital also seeks to register three new companies on NILEX in 2016.
FEP, which is owned by Egyptian and Gulf investors, has great confidence in the Egyptian economy and the performance of the Egyptian Stock Exchange (EGX) in the upcoming period, Al-Shahin said in a statement to MENA.
Al-Shahin said this success is a result of the company’s strategy to expand in the Egyptian market in light of the clear economic recovery. It also seeks to attract more Arab and foreign investments to the market in light of all the promising investment opportunities in Egypt and the high revenues, especially in terms of direct investment.
Managing director of FEP Capital-Egypt Omar El-Maghawry said the first of the two companies offered on NILEX are Integrated Engineering Group (IEG), which carries out mechanical and metal fixture works with capital of EGP 3m and 15m shares. About 20% of IEG’s shares were offered with a value of EGP 0.60 per share, oversubscribed at 35 times during the IPO.
The second company is Egypt South Africa for Communication (EGYSACOM), which works in the installation and maintenance of mobile networks with a capital of EGP 6.4m over 31.9m shares. Some 20% of its shares were offered at a value of EGP 0.95, oversubscribed at 11 times during the offering.
El-Maghawry said the FEP is undergoing negotiations to register two new companies on the NILEX by 2016. Both companies operate in the field of gas filling, and the size of their capital amounts to EGP 37m in total; EGP 22m and EGP 15m.
FEP contracted with the Pharmacists Union Company in Minya to be credited in NILEX with a capital of EGP 66.13m and a nominal value of EGP 1 per share.
“The company aims to acquire eight SMEs in the food industry, construction, and telecommunications sectors throughout 2016,” El-Maghawry said.
The group allocated about EGP 500m to invest in the Egyptian market in 2016, according to El-Maghawry. FEP acquired the majority stakes in two companies in the agriculture and food sectors, worth EGP 40m, through its subsidiary Engazat Misr, which specialise in SMEs.
He said Engazat Misr acquired 55% of the shares of Suez Canal Trade and Agriculture Development Company, which was established in 1981 and has a market share of 10% of the seed market in Egypt. The company is seeking to carry out a comprehensive restructure of the acquired company and inject more investments to begin exporting to Arab and African markets.
Engazat Misr also acquired 54.2% of NOG Investments, which operates in the restaurants and cafes sector. FEP is seeking to increase its catering activity in the local market by increasing the number of branches and focusing on Arab markets.
El-Maghawry said these acquisitions come within the company’s strategic plan to expand in the food sector in the Egyptian market, which has enormous opportunities for the growth. “First Equity is very positive about the Egyptian company,” he said. “It is one of most promising markets in the region for its investment attractive elements and infrastructure.”
