EFG-Hermes Holding SAE (HRHO), the biggest publicly traded Arab investment bank, climbed to the highest level in a month after a potential offer that would have blocked a joint venture with Qatar’s QInvest LLC stalled.
The shares advanced 2.2 percent to 10.93 pounds, the highest since June 3, at the close in Cairo. The benchmark EGX 30 Index gained 0.8 percent.
Planet IB Ltd., a consortium led by Egyptian bankers, said it was seeking to acquire EFG-Hermes for at least 13.5 pounds a share subject to due diligence. Shareholders of the investment bank instead voted to approve a joint venture with QInvest and take advantage of a four-pound cash dividend per share. The agreement with QInvest is subject to regulatory approval.
“The shares are up in part because investors believe Planet’s bid will not go through,” Teymour El-Derini, Cairo- based director of Middle East and North Africa sales trading at Naeem Brokerage. “That means the QInvest deal will go through, which means a four-pound dividend.”
Planet’s Chief Executive Officer Ahmed El Houssieny said the company hasn’t dropped the bid. “But at the same time, we haven’t been invited to conduct due diligence yet,” he said in a text message.
Egypt’s financial markets regulator said June 25 that acquisition offers can only be conditional on obtaining majority control. Any statements by investors or entities on plans to bid for listed companies without fulfilling regulatory requirements may be subject to legal action as they can affect share prices, the Cairo-based Egyptian Financial Regulatory Authority said.
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