23 June 2015       Download

Qalaa Holdings “Qalaa” (CCAP.CA on the Egyptian Exchange), an African leader in infrastructure and industry, has today signed a set of agreements with Financial Holdings International (FHI), one of Qalaa’s major co-investors, through which Qalaa will acquire from FHI additional stakes in subsidiaries that are core to Qalaa’s future as a holding company. Qalaa will simultaneously sell to FHI its holdings in multiple non-core business units.
The stakes Qalaa is acquiring are in companies that have leading positions in the energy, cement and transportation sectors, among others.
The transaction will entail Qalaa selling to FHI its stakes in MENA Homes, Grandview and Dina Farms Land Companies; the latter are to be spun-off from existing investments.

In parallel, Qalaa will acquire FHI’s stakes in ASEC Holding (cement), TAQA Arabia and Mashreq (energy), Nile Logistics (transportation), Dina Farms Supermarkets (food retail chain), and United Foundries (metallurgy).

The transaction is targeted to close in December 2015 subject to certain conditions precedent and customary termination rights. The transaction will result in a reduction of Qalaa’s consolidated debt by c. EGP 800 million. Deleveraging is a key strategic goal for the company in 2015 and onward.

Qalaa’s effective ownership of the assets changing hands through the transaction is outlined in the table below.

Qalaa’s Effective Ownership
Asset stakes added by Qalaa Current Post Transaction
ASEC Holding 69.3% 99.0%
NDT Convertible* 38.1% 84.1%
TAQA Arabia 62.6% 80.4%
Mashreq 71.3% 84.3%
Nile Logistics 67.5% 92.6%
Dina Farms Retail Supermarkets 55.0% 88.6%
United Foundries 67.5% 100.0%

Assets sold by Qalaa Current Post Transaction
MENA Homes (Designopolis Mall) 60.2% 0.0%
Grandview 48.0% 0.0%
Dina Farms Land Companies 55.0% 0.0%

*NDT convertible includes note 1& 2
Emerging Markets Capital Partners Limited (EMCP) DIFC acted as sole financial advisor to FHI.