Hegazy & Associations in association with Croweel and Moring are providing consultancy services to Egyptian investors who are in the initial stages of establishing two offshore direct investment funds.
The first investment fund will specialise in small and medium enterprises (SMEs), which represent about 80% of the Egyptian economy co-founder of Hegazy & Associates Walid Hegazy told Daily News Egypt. The first fund’s total capital is $25m and aims to invest an average of $2m in every target company.
Hegazy said the fund was established to fund SMEs since that economic sector has recently been characterised by rapid growth at an annual rate of up to 20-25%. The sectors saw increased access to funding and more specific management and marketing strategies in accord with market developments.
The other direct investment fund will have a capital of $15m and will specialise in investments in real estate units. Hegazy & Associates aim to tie the fund’s investment to the increased activity in the real estate sector in the domestic market since real estate value is considered immune to inflationary pressures.
Hegazy & Associations’ direct investment funds collect money from investors to purchase shares in companies, keeping them for a period of up to 5 years. Hegazy said investors preferred to establish funds offshore due to the complexity and lengthy regulatory procedures in Egypt.
The Egyptian Financial Supervisory Authority (EFSA) is responsible for issuing approvals for the establishment of direct investment funds.
Hegazy said his office is also provides consultancy to a Chinese company that seeks to make large investments in the 1.5m acres project in Upper Egypt and the developmental projects in the Suez Canal region.
