EFG-Hermes Holding SAE (HRHO), the biggest publicly traded Arab investment bank, rose to the highest level in almost seven weeks after HSBC Holdings Plc’s Middle East unit bought more than a 5 percent stake.
Shares of the Cairo-based firm advanced 3.3 percent to 11.29 Egyptian pounds at the 2:30 p.m. close in Cairo, the highest level since May 17. That values the company at 5.4 billion pounds ($892 million). The benchmark EGX 30 Index (EGX30) retreated 1.4 percent.
HSBC Bank Middle East Dubai bought about 32.25 million shares at an average of 10.15 Egyptian pounds on June 28 from Dubai Financial Group LLC. The stake was valued at $54 million on the day of the transaction.
The deal “is boosting sentiment for sure,” said Wafik Dawood, director of the institutional sales desk at Cairo-based Mega Investments Securities. “It is a reminder that the company remains solid and trading on cheap multiples.”
EFG-Hermes is waiting for approval from Egypt’s regulator to proceed with the formation of a joint investment bank with Doha-based QInvest LLC after shareholders approved the transaction on June 2.
The stock has gained 13 percent this year compared with a 36 percent advance for the benchmark gauge.
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