Emirates NBD has been approved to explore acquiring Banque du Caire, with the deal potentially exceeding USD 1 billion. This move is part of Egypt’s privatization strategy, aligning with international economic reform recommendations. The acquisition process is expected to be expedited, with public interest and scrutiny surrounding the sale.
Emirates National Bank of Dubai (NBD) has received approval from the Central Bank of Egypt to conduct due diligence for a potential acquisition of Banque du Caire, with estimates suggesting the transaction could surpass USD 1 billion (EGP 50 billion). According to sources cited by Asharq Business, the Egyptian government is keen to expedite this deal, anticipating completion within six weeks.
The acquisition aligns with Egypt’s ongoing efforts to privatize state-owned assets as part of broader economic reforms influenced by the International Monetary Fund (IMF). Recently, the IMF encouraged Egypt to implement a new economic model aimed at decreasing the state’s involvement in the economy.
Although no formal announcement has been made, the potential sale has generated significant public interest. TV host Amr Adib commented on X, highlighting that such a secretive sale is nearly impossible and indicating that further details of the buyer’s offer will emerge soon. He remarked on the historical attempts to sell the bank since the 1990s.
As of September, Banque du Caire, which is wholly owned by the state-run Banque Misr, held assets amounting to USD 9.4 billion (EGP 478 billion). Reports indicate that Banque Misr is looking to divest a 45 percent stake in the institution for up to USD 1.2 billion (EGP 60 billion), with plans to list additional shares on the Egyptian stock exchange.
This push for privatization is a strategic initiative aimed at enhancing economic productivity, attracting foreign investment, and alleviating the financial burdens on the Egyptian government. In a press conference held last December, Prime Minister Mostafa Madbouly announced intentions to divest shares in a minimum of ten state-owned companies by 2025, including four military-owned entities.
These military-run companies, like the fuel chains Watanya and Chillout, are set to be sold to strategic investors or made publicly tradable on Egypt’s stock exchange, marking a pivotal shift in Egypt’s economic landscape.
In summary, Emirates NBD’s potential acquisition of a stake in Banque du Caire signifies Egypt’s commitment to privatizing state-owned enterprises as part of its broader economic reforms. With the transaction estimated to exceed USD 1 billion, the government aims to attract foreign investment while implementing changes recommended by the IMF. The ongoing efforts reflect a significant shift in the economic strategy of the country, anticipated to enhance productivity and stabilize public finances.
Original Source: egyptianstreets.com
