Financial transaction

First Abu Dhabi bids on Egyptian investment bank EFG Hermes

An Egyptian walks past a branch of investment bank EFG Hermes in Cairo, Egypt May 29, 2018. REUTERS/AMR Abdallah Dalsh

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DUBAI, Feb 9 (Reuters) – First Abu Dhabi Bank (FAB.AD) has made an offer to buy a majority stake in Egypt’s largest investment bank EFG Hermes (HRHO.CA) which values ​​the northern lender -African to $1.1 billion, a regulatory statement said.

FAB, the UAE’s biggest lender, has made a non-binding offer to buy at least 51% of EFG Hermes for 19 Egyptian pounds ($1.21) per share, the regulator said. Egyptian finance.

If the deal is successful, it would be FAB’s second major deal in Egypt after taking over the Egyptian operations of Lebanese bank Audi (AUDI.BY) last year.

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Under Egyptian rules, a party seeking to buy more than a third of a listed company must make a mandatory tender offer for all remaining shares, the lawyers say.

EFG Hermes said in a statement to the London Stock Exchange that the completion of the transaction and the final purchase price would be subject to the completion of “satisfactory full due diligence” and required regulatory approvals.

After that, a mandatory takeover bid would be made to all shareholders.

Rothschild (ROTH.PA) is advising FAB on the deal, two sources familiar with the matter said.

FAB and Rothschild did not immediately respond to a Reuters request for comment.

The FAB wants to keep the Egyptian investment bank independent, the sources said, potentially ruling out a combination with the Abu Dhabi lender.

The purchase of EFG Hermes would give FAB access to the Egyptian investment bank’s strong investment banking franchise in the Middle East and North Africa region.

EFG Hermes has advised on major transactions, including Saudi Aramco’s record $29.4 billion IPO in 2019.

First Abu Dhabi Bank, formed from a 2017 merger between National Bank of Abu Dhabi and First Gulf Bank, has advised successful UAE IPOs and loan deals in the region.

($1 = 15.7150 Egyptian pounds)

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Reporting by Saeed Azhar and Yousef Saba in Dubai and Patrick Werr in Cairo; Editing by Louise Heavens and Barbara Lewis

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